Upgrade from the previous version, which JUST includes the files which
have changed. It would be nice to know what's changed so I can compare
it to the files I modified instead of having the entire SiteFinity
folder sent to us every time (my sitefinity folder is heavily modified)
Since version 3.6 we use embedded templates. And they solve the problem you are referring to above. Generally speaking you map only templates that you want to modify. By default all provider folders are empty.
2) Full upgrade from any other version to the latest
Since we use embedded templates and the fixes are made to the controls that are into assemblies you get the full upgrade.
the Telerik team