How do I test an update of my application, versus a clean install? I see that adb install has several flags, but I'm not sure which one mimics reality.
I explicitly need to test app updating.
You don't need to re-install to get a 'clean install', you can just wipe the application's data.
Go to Settings > Applications > Find your app and use 'clear data' (or similar). At that point your app won't know the difference unless you are also using files on the SD card.
And, of course, app updating can be tested by installing normally (or, with adb, you can use adb install -r for installing while keeping the app's data, as you would on the market or with an APK)