I don't use the speaker output on the monitor, because then the sound stops when the screen is off; I use the audio output on the motherboard. So, I disable all the digital audio outputs, including the AMD High Definition Audio Device.
The problem is, whenever I upgrade the Radeon driver, that AMD audio resurrects and then takes the default audio output position, so I can hear no sound.
Is this a bug, or an intended behaviour?
It is normal behavior. The most recent driver installed just becomes default again. Just go into sound settings and change your default to whatever sound output device you like.