Then, shouldn't the client or server logically force chunk updates to the world whenever a change like this happens?
Jadzia, I'd say, it's a combination of both. There are different properties according to Biomes, such as forest, desert, etc, with blocks changing colours depending on how spread out a biome is, and there's also the fact that the world is procedurally generated as you explore. The game should logically say, "put long grass here!" and have it just be there regardless of how old the world is.