Getting the latest drivers for hardware is simply good practice. It also makes sure that all components of the system are at the same level. For instance, with games the latest graphics card drivers make sure that the game plays properly and DirectX is fully supported, as this gets updated every so often. It also helps to renew drivers already installed on the system to ensure that any file corruption is rectified.
I agree that a lot of updates are too large for people with normal dial-up. Normally the updates are available by magazine cover CDs if they are too large, or orderable on CD for certain products. It also appears true that drivers and software are released before they are perfect - it is logical that no large piece of software can be released 'perfect' within any decent production time and costs, especially in such a fast-moving industry where if you are late with a game or product, you lose money and momentum and potentially delay any further projects.
Regarding flashing the BIOS, the BIOS in my PC was released about six months before I got the PC. In the time between, a lot of new hardware and software had been developed and it only makes sense that a new firmware had to be developed to keep this BIOS up-to-date. It seemed to cure one or two problems with my machine after I had updated a few things and installed some hardware that was initially problematic.
So I think this problem is here to stay.