It's rather stupid to make flash files that are just updates, because there is actually more work to take care not to overwrite those parts that are not covered by the update.
The flash updates are not partial updates. They contain the full firmware contents. However, the updater application needs to read the contents of the original flash ROM to get the correct configuration information.
IIRC the flash updater tool might even have some switches to provide some of this configuration information, but I might remember incorrectly (I'm fairly sure that there were some options to specify the CPU speeds etc).
As for the Phase5/DCE build quality: I've had Blizzard 1230-IV, 2 x Blizzard PPCs, BVision PPC, 2 x Pegasos I, Pegasos II and an EFIKA. All have been of excellent build quality (it's a small sampling I know).