How to determine what caused Anniversary Update to fail

From your latest post. You did set it back to the original.

(1) do I need to create an empty 500MB partition on my boot drive prior to running the upgrade (I think the answer to this is no.)

My answer would be yes even though your system is running fine. But the upgrade would fail if this partition is missing.

(2) what is the 450 MB partition doing on my boot drive and can I delete it/re-use it's space to make a 500MB empty partition (if needed)

Windows Upgrade create this 450 MB partition to put a new WimRE.wim (Basically it is a WinPE version containing a set of tools for trouble shooting specifically for version 1067.

(3) in the first posting by babis49 on the thread "windows 10 Anniversary upgrade created a recovery partition", what are those 3 partitions with no drive letters, how did they get there, and which ones are really needed.

The post in this thread does not really apply to your situation. His Windows installation used GPT partition scheme. Yours is MBR

(4) Whether or not I have to create an empty 500MB partition, should I disable all my other drives before running the upgrade

No

(5) What is a good piece of software for fixing the MBR/BCD stuff if it breaks and what is the procedure for doing so

Macrium Reflect Free . Been helping other people with similar problem as yours.

(6) Why is the best option when the Win10 ISO disk says it cannot fix a boot/startup problem

Not the best if your partitions are not in the right order.

(7) What is in a Recovery Partition and what is it used for

Already answered above.

As I said above, a fresh install of Windows 10 will give you a 500MB and C drive only. However, in previous versions (Win 7, Win 8/8.1) the reserved partitions for those are small 100MB for Win 7 and 350MB for 8/8.1, not enough room for the new code for Windows 10 so they create an extra 450MB and move WinRE.wim (over 300MB) instead of re-partitioning drive C which would take a long time to upgrade.
Here's my suggestion if you wish to follow:

1. Download and install Macrium, from Macrium: create a USB Rescue disk (important)
2. From Macrium, create a backup image of your C drive only and store it in one of the drive (D: or E:)°
3. Download my 500MB Reserved partition: BootMBR_Only-00-00.zip - Google Drive
   Unzip and store it in the same place with your C drive backup image.
4. Boot up the USB rescue disk, browse to where you save the images, select the 500MB first to restore
5. Select your current Windows C drive as destination, click on each partition then click on "Delete this partition" until the destination drive shows empty.
6. Click on 500MB, drag and drop to the destination, click Next->Finish to restore this 500MB partition first
7. Again, browse for your C drive backup image, drag and drop after the 500MB, Next->Finish
8. Click on Restore tab, click on "Fix Windows Boot Problems"
   
9. Reboot your PC. Try to upgrade again

P.S A similar problem is in this thread where OP could not upgrade his MBR Windows (same as yours) but in addition, he also wanted to convert to GPT.
Solved Small Wrinkle in Anniversary Update....MBR Disk - Windows 10 Forums

From Disk Management. You have your Kingston SSD drive letter assigned as X: . It might be a collision with WinPE and Macrium Rescue disk is built with WinPE. When you boot from Macrium Boot disk or Windows Recovery disk, X: is reserved, everything is loaded into RAM and run from it. From the screen shot the drive letter of this SSD was taken out, made it hidden. Re-assign the drive letter such as Y or Z.

The Macrium restore failed rather badly. I got both partitions restored ok and the Fix Boot Problems appeared to run OK. But on reboot I got the Blue Screen message "Your PC needs to be repaired. Boot configuration data missing or contains errors"

I booted off my Win7 ISO disk but the repair function said it could not repair anything. Next, I restored my backup (only) after having removed both C: partitions. That ended up with the same results. So I formatted the drive and will try one more Macrium restore.

That worked - sort of. After the Macrium restore I still got the same error message, but this time the Windows ISO disk was able to correct the error. So now my system looks like this:



It's been about 10 hours working on this so far, so I'm going to take a break for a while.