Hi,

           if noupdate = 0 or not defined in <data>, when you update a module, odoo verify corresponding records between all records in xml files and records in table ir_model_data and in model defined for the record in xml, the relation between ir_model_data and the model are in ir_model_data with columns res_id (id in model table) model and module, complete_name is module_name.xml_id, you can see column noupdate too (file base/ir/ir_module.py).

For all new records add in xml file if noupdate=0, a record is add in ir_model_data and model, for existing records in ir_model_data and xml if noupdate=0, datas in model are updated, if noupdate=0and  if a record is present in ir_model_data with values your module/your object/... but not in your module the record in ir_model_data and in the model defined in xml for the record will be deleted. But if there is a reference of your model record id in an other record you  will have an integrity error.

bye