Basic block level vs file backup SFTP is considered to be a legacy protocol on our side, so I wouldn't recommend using it. It's provided "as is" with no guarantees.
As for the block-level backups, you're absolutely correct, you need to run full backups from time to time to make sure versioning and purging are consistent.
Full backup implies re-upload of any changed changed files, not the whole backup set. It works on a per-file basis, so unchanged files will not be re-uploaded.
Block-level option is mostly beneficial if you have large files or using image-based backups, for plans with small files you won't really notice any benefits.