Steps to repro:
1) Upload a file, do not click notify members.
2) Used the update icon to rename the file
3) When doing 2), click Notify Members
4) Afterwards, no one gets a notification, including owners and moderators.
My expectation would be that the choice of notification is on a per action basis, that is, whether the initial upload was no notify isn't relevant to the desire to have the update notification sent.
PG&E Delenda Est