The size of the updates and also the size of the game itself might be due to how it is packaged. You want data that belongs together and is accessed together to be stored together. For example, the game might have one file per level that is loaded and kept in memory when you enter that level. You might even store the same asset multiple times if that means it's easier to access sequentially. This optimization is less necessary in the are of ssds but you don't want your game to be completely unplayable on people that still run it from a hard drive.