I think it has something to do with the status change --- lets say your search is looking for billed orders with some other criteria of date = today and amount > $500. If you create an order on today thats > $500, it wont be marked as billed, so the email wont trigger. But you would assume that after the order ship and the invoice/cash sale is created, then the email would trigger because it's now Billed, Today and >$500 --- but it doesnt. But I believe (i'd need to double check on this) if you then edited that order and made ANY change, and saved it --- the email would trigger. I think it's something about the status being changed on the "back-end" that doesn't trigger the criteria on the "Send on Update" feature.