As I understand it, Silverblue – a rebrand of Fedora’s existing Atomic workstation project – uses an image of the entire installed OS. Any update sees that entire image rebuilt and the system rebooted. Previous images are retained, allowing easy rollback if an update goes wrong. You reboot, select the an older image, and boot into it.
Desktop applications via Flatpaks leverage their isolation and sandboxing. Individual Flatpaks can be updated without rebooting.
Traditional RPM packages from Fedora’s repos work fine, too, and are incorporated into the overall image.
I’ve played with the Fedora 29 version of Silverblue. Worked as advertised, more or less. It’s a prerelease, after all. In use, apart from the package install and update mechanisms, it’s the same as the standard Gnome release.
The rollback feature has obvious advantages, especially for server operations. Currently, the “catch” seems to me that while an increasing number of apps are available as Flatpaks, that number remains small in comparison to traditional repos. Flatpaks are also quite large, and getting Silverblue correctly configured to use them was not obvious. I.e., I had to jumb through some hoops before I was able to download and install Flatpaks from the Flathub site. The installing and management of RPM’s uses a different syntax. A GUI app that hides these differences would be useful.