TheMadGuy is of course correct.
It all boils down to Pinnacle's dumb way of listing updates I'm afraid. Update v7.1.1 turns IC7 into v7.0.3.142.
Understand? No, nor do any of us it seems.
They really do have a dumb way with these updates and all it does is confuse everyone.
The 7.06 update patch is for the full Instant CD/DVD software package and that is why the update is so big, and yes it includes the latest IC7 7.1.1 patch.
So if you only have IC7 then the only upgrade you need is the 7.1.1 patch. Or upgrade 3 as Pinnacle also call it. I say we just call them by 1, 2 or 3 from now on as they have been doing on another forum. I can understand them from those listings.
And yes ICHSE 1.3.1 works with both versions of IC7.
Hope that explains it.