Potential Solution - Here's what worked for me.
After receiving a few responses from Adobe (followed by dead silence), I took matters into my own hands.
As referenced in my earlier responses in this thread (under the name Cubelodyte), I posited that the issue was related to recursion between 2 or more libraries.
Here was the setup -
We had 2 libraries: Icons and Major Components.
Many of the major components in the MC library were built with nested icon components from the Icons library.
Solution: Combine the 2 libraries into one so that no library contains any reference to components in another library.
Other Potential Contributing Factors - Nested Components Shared Between Non-library Project Files
I had been building nested components for years before they became officially supported as "a thing" in XD. I called them compound components (or compound symbols -- that's how long I've been using them). This means that many components that ultimately became library components were being shared from file to file in the Cloud without the governance of the Cloud Library architecture. In fact, many of them were shared between local files before the Cloud rolled in and put a fog over nearly everything I had created over my first 2 years of using XD.
Somewhere around the introduction of Libraries and the new feature "Nested Components" was the point at which many of my components became delinquent and started causing all manner of disruption in the files that shared them (broken links, components that are no longer used in a document but cannot be deleted or made local, etc.).
Hypothesis:
Premise - Sharing components between XD project files has never worked completely.
There has always been a function for re-linking broken component links and it has never worked. The introduction of the Cloud and Libraries has probably fixed all of this (As of this week, XD officially prevents any sharing of components except via libraries). I suspect that anyone who begins creating new design systems and new libraries using XD and Adobe Cloud will have no issues. It is only those of us who are carrying forward legacy design project collections that experience the growing pains of system improvements that are not truly backward compatible.
Therefore - These issues will not present themselves in a fresh, clean design system based on the lastest XD release.
Since I was not willing to toss aside 4 years worth of design work, I tested this hypothesis by bringing all the components of our Icons library into the Main Components library. I used the "Make Local" function to create component instances inside the MC library and then eliminated the Icons library altogether. Since doing so, I have had no further issues with the infinite update.
Note 1:
The solution outlined above is not for the faint of heart. Any project file included direct references to icons in the Icons library had to be manually updated to use icons from the the MC Library. This meant first finding all the broken link components, making them local, and then replacing them with their counterparts in the MC library by dragging from the Assets panel onto the existing instances in the document.
This process is very time-consuming. For most applications, this would only be necessary if the legacy document is current enough to need updating any time the official component is modified.
Note 2:
Although the libraries had been in a perpetual state of "you need to update", they were, in fact updating successfully enough that changes were propogating to the project files that used them.
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