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This is a narrow solution to a wider problem: overrides getting replaced when a bundled-addon is upgraded. The same problem exists for templates, and even for code. It would be pretty normal for the code in non-bundled addons to be altered too, because these addons are often very specific rather than general purpose and hence more likely to need customising.
If something is "rephrased" but then the original is changed (a common enough situation), then this is a reason even the narrower problem is not actually solved.
I don't think there is a good solution to the broader problem, or the narrower problem, and adding a lot of default overhead to the structure of the system adds complexity that makes the system more complex for everyone.

I think the real solution is simply that people need to pay for the developers needed to keep addons maintained, and that we should have a free market of talent that feels empowered to sell services for that work. Or, people learn to do diffing etc themselves.

Sure this isn't a 100% fix, but it IMO does get us closer. And I believe it is a big enough problem to address at least to the capacity I suggested, which wouldn't be that hard to implement at some point. We can't expect users to diff non-bundled addons. Not only is diffing mostly a tool aligned on the developer end, but IMO no one should be expected to have to diff and merge code which they didn't modify (e.g. non-bundled addons are not inherently modified). Having such expectation exposes the fact our plugin / non-bundled addon system in itself is flawed; I know no other software where users are expected to diff after installing an addon (unless it's a custom addon not supported or distributed by the core developers of the software).