well, AFAIK it updates all programs in the Sonar sub structure indicated by a yellow flag, but it does not update Sonar itself. so the way it has worked for me was to click "update all" first to get the Sonar components and once completed, click "update" to update Sonar itself ... not very intuitive ... I wish "update all" would indeed update all

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Red flagged products are not for you as you don't own them.
They are there so you can see what is available for purchase though.
 
Those that are yellow are available for update. And FWIW, has always worked for me though
I don't think I've actually done an update all since early last spring.
 

i think red flag are/can be for products you do own but have not installed, or products you do own and have installed, but not via ccc, or installed prior to them being made compatible with ccc. rapture, dim pro for example i have owned for ever, and when they became ccc compatible they started showing up in ccc flagged with the red dot even though they were owned by me and installed. the red flag stayed until i installed/updated to the ccc compatible version via ccc. plus rapture session i believe i own being a platinum owner/lifetime member (?) and it shows as red because i haven't installed it, as i own rapture pro full

Doesn't work for me either but it does look like it will update all items contained in a single folder.
 

maybe it's broke now. why not.

Red is products you own that are not installed on that computer. 
My Professional used to be yellow because it was out of date, Now it is red because I uninstalled it.  
And Home Studio is Red on the computers I didn't install it on.  
If you don't own a product it will not show in CCC.
 
I was fussing about again and what Rob say's is exactly it. "Update all"  only updates the folder content when you select the main program. , The main program will not be updated unless you click "Update".
 
It is interesting that you can delete the entire contents of the CCC download folder and CCC when run will still be happy.
So all you folks with SSD drives who panic because your running out of room, Just copy that folder over to an external drive and delete the entire local folders content. For me it was 17 GB on each machine.
The folder is found Computer/Program Data/Cakewalk/Command center/Downloads. Once installed those files are no longer needed. But back them up first. You may need the rollbacks and you can also use these to set up a second computer.     
 

 where are the cc downloads stored?

"Update All" has never updated all.  If there is an update for Sonar and updates for Sonar plug-ins, if you click update all it will update all the available plug in updates but not Sonar.  Sonar has to be done separately.
 
There have been threads about this before.  Update All should actually do that - Update all available programs and plug ins. 

I posted a feature request last year to make the Update All button actually update all but sadly I guess it still hasn't been done (I gave up on it long ago)...
http://forum.cakewalk.com/Command-Center-Have-an-Update-All-button-that-actually-updates-all-m3423999.aspx
 
This is one of those things that seems so obvious that I have to wonder whether it is a feature or a bug.
 
At least rename the button to something else to reflect what it is actually doing.