I can't answer your question definitively, but I can say this. When you go to cut in SCAL, it asks you what model and firmware you have installed. To me, that would imply that you don't HAVE to update the firmware.
If you want to use the updated CDS version, THAT program will force you to upgrade your firmware.
The update is just for the firmware.
To find out what an update is achieving, if you go to the download link and instead of clicking on download beside the Sure Cut a Lot for Windows ( or MAC) option, click on the version number (in this case 1.015) and it will give you a list of what has been changed in the update.