When the OC reports a CO, the only date that is really relevant to credit reporting is the DOFD on the OC account. The date of reporting of the CO itself is relevant only in that is the time after which it posts to your CR, and thus begins to hurt your crdit score.
An upaid CO, like any reporting of delinquency or derog on a debt, has an SOL running on the debt itself. In most states, that will probably be the same as the DOFD, but it could vary under your individual state civil code. I mention SOL first because whatever path you take to pay the debt, the OC always has its own recourse to bring legal action. If the SOL on the debt has not expired, you would be left without an SOL expiration defense in court.
When an OC does a CO, yes, every month thereafter, they can report the CO status to the CRA. That does not really "update" anything. It is just an annoying but proper reiteration of their prior reporting.
There is no "best" way to pay a CO. If "best" means avioding legal action and you are still within SOL, this might mean doing aPIF.
If "best" additionally means CR deletion, then you can try a PFD, knowing the risk that if you are still within SOL, this has its peril. You could also take the less risky but probably more uncertain path of doing a PIF, and then relying on a GW deletion after payment.
It is a personal risk vs benefit decision.
