You'll see older pc centric game engines use loose files. With the advent of ssds on consoles we might see a return to bunch of files approach as it keeps patches smaller.

Steam and EGS updating handles binary diffing wonderfully. While consoles, not so much. Specifics are NDA of course but I bet any game dev reading will know who I am talking about when I say: "platform x has a horrible diffing algo yet requires approvals for updates over size Y". If I could ship a loose filesystem and get reasonable load times I would just for the update package advantage.

No, packing individual files into archives makes sense on PCs too due the native filesystem usually having a much bigger per-file storage overhead as well as non-negligible open() times - the second is especially true for Windows with "Anti Virus" software installed.

> You'll see older pc centric game engines use loose files.

Some maybe, but packing game assets into archives is as old as Doom and has been the norm all this time.

> Steam and EGS updating handles binary diffing wonderfully.

Steam handles binary diffin now, but it was not that long ago that it re-downloaded the whole changed file.