Margaret - It really depends on what you mean by "all updates". If they truely want all updates (system updates, updates for all issues, tasks, etc.) they would probably look under the "Updates" tab of the project. You could also create a report of updates and filter out things that they didn't want to see. I have one report that shows all text updates to Issues that some PM''s want, and then I have another that wants that and all status changes.
Eric - when creating a new issue, (depending on what email events are checked), all people assigned to the issue and the primary contact receive an email.