Looking at pyanaconda/ui/gui/spokes/source.py 's noUpdatesCheckbox - the checkbox labelled "Don't install the latest available software updates. Install the default versions provided by the install source above." - it seems to be implemented very simply:

        self._noUpdatesCheckbox.set_active(not self.payload.isRepoEnabled("updates"))

...

    def on_noUpdatesCheckbox_toggled(self, *args):
        """ Toggle the enable state of the updates repo
        """
        if self._noUpdatesCheckbox.get_active():
            self.payload.disableRepo("updates")
        else:
            self.payload.enableRepo("updates")

so, very simply, if it's checked then "updates" is disabled, if it's unchecked then "updates" is enabled.

However, our repo configuration isn't that simple: it's different for pre-releases. For pre-release images, we enable the "fedora" and "updates-testing" repos, because for Branched releases, the "updates" repository is empty, and all 'stable' stuff winds up in the "fedora" repository.

For release images, we enable the "fedora" and "updates" repos, because that's a sensible default (let network installs get 'stable' updates, but not untested stuff from updates-testing).

So I think the behaviour of this checkbox is correct for release images, but not pre-release images. I think it needs to be written in a more sophisticated way, so that on post-release images it toggles the state of the 'updates' repo as it does at present but on pre-release images it toggles the state of the 'updates-testing' repo instead.