When you fire up Home, it inspects the contents of your device, compares those contents to what the server has to offer that might be more current, and presents you with a series of update options from which you may choose (assuming they have anything more recent for you).
If you select any for download/update, the information is first sent to your computer, and when complete, is then automatically transferred to your device. You'll see all of this happening on the progress indicator as it happens.
The transfer to your computer vs. direct transfer to your device saves them having to deal with aborted downloads in a very messy way. It's much simpler to deal with this on the PC side when it's an issue. Once the data is safely in your PC, only then does it get transferred to your TomTom.
So in answer to your question, your latter understanding is the correct one... and again, for full map updates, it will be the speed of TomTom's servers, no matter what bandwidth you can support on your end, that represents by far the largest portion of the total time for the job. The USB transfer rates will be the least of your worries!