'Update Auto-rebuild Model viewpoints continuously' will always rebuild your model for you when a change is made. For example, if you are in an section window and move a door, it will rebuild the viewpoint and clean up the wall so that the original wallhole disappears. If you don't have it checked, the hole will still appear there until you manually force a rebuild. Until then, the Element Information Info Tag will show the wall as an 'Out-of-date section element'.
As the name suggests, it only applies to auto-rebuild viewpoints. And only in the current window or when the window is brought to the front, as per the regular functionality of an auto-rebuild viewpoint.
Updating the drawing is a different matter, and it will show an updated model when updated regardless of the continuous update(
). I think the main purpose of this function is mainly to allow speedier work in sections and elevations.
Hope that answers your questions. Sounds like you could do with all the support you can get there at the moment. Good luck with it all.
Cheers,
Link.