When you talk about these recovery options and the disk showing as locked, are you referring to BitLocker? If so, then it's well documented that BIOS updates will cause BitLocker to prompt for a Recovery Key because the TPM refuses to release the decryption key when it detects certain types of changes in the hardware environment, including a change to BIOS versions. The reason is that certain types of hardware changes could be part of an attempt by an attacker to get the TPM to release the decryption key inappropriately, thereby compromising your data. The workaround to avoid this is to choose to SUSPEND BitLocker immediately before restarting to perform the BIOS update.
If you didn't back up your Recovery Key anywhere, then you're stuck. You'd have to erase your whole hard drive and reinstall Windows from scratch -- but in fairness, Microsoft makes it very clear when you enable BitLocker that you need to store your Recovery Key somewhere other than on the encrypted drive itself, for exactly these types of cases. Other times you might need the Recovery Key are if your motherboard is replaced (since the TPM will be different and the new one won't have your key) or if you ever need to read that drive from another system (since that system won't have your key either).
If you're not using BitLocker (or if you are and you don't have your Recovery Key), then if you want to start from scratch, boot into Windows 10 installation media, and before you move forward, press Shift+F10 to bring up Command Prompt. Then enter the commands below, which will erase your hard drive and allow you to reinstall from scratch:
select disk 0
Then continue with Windows Setup.
And as for your general question about why Dell releases BIOS updates when they're not sure they will work, there's always a risk that certain updates will go wrong. Sometimes Windows updates make a system unbootable, but do you think Microsoft should therefore never update Windows and leave security issues or other bugs unpatched forever? Of course not. This is why recovery mechanisms are provided and why at least some people perform frequent backups.
This sounds like a change was made to the operation mode of the drive. Was the OS factory installed? If so, make sure secure boot is ON, legacy mode is OFF, and that the drive is set to (most likely) RAID mode.
If you installed the OS, reset the drive settings to the ones that were in place when you did the Windows installation.
(the reason was not BitLocker)
It appears that the reason it got stuck was that it had to install both WindowsUpdate 1607 and 1703. Now it is updated to 1703 Creators Update and it looks like it works.
Still, if I check with DELL the Drivers Download suggests that I install the new BIOS and Controller. But now I am afraid that it will crash again if I do...
Any advices? Should I just avoid updating drivers if the laptop works fine?
thanks in advance.
Avoiding driver installs when everything works fine is more of a philosophical question. I tend to like keeping my systems updated, but I also have backups in case anything goes wrong. If you don't want to deal with that, then the recommendation I make for the average user is to update software only if it patches some key security vulnerability or includes an enhancement/bug fix that actually matters to you. Otherwise, if it works, then there's definitely a case to be made for leaving things alone.