I guess as a follow-up, you possibly can’t actually “update” firmware for this, without it creating entirely new keys that would have to be registered with every application
You're mostly correct. The immutable firmware derives unique key material for each device+application combination. However, nothing prevents the loaded application from loading another application. This allows the developer to construct their own update logic. For instance, the first application could simply exist to verify a digital signature over some hash, then load an application, hash it, compare it to the trusted hash, and then execute it. The first application could hand over its own key material.