You're right.  Setting AUTOUPDATE_VERSION says that it's OK not to update the client right away, but the client will still update if the user reloads the page or navigates to the app again.  Using AUTOUPDATE_VERSION in the app cache manifest would break that pattern, because the app cache wouldn't necessarily be loaded with the latest code (in many cases it would be because we also includes hashes in the individual entries in the manifest, but not for example for the app HTML).