A. When you research the upgrade, how do all the units get it on the field? Why don't they have to come back to base to get the upgrade, kinda like a car being modded?
B. Why is there a supply limit of 200?
After some careful thought, I have came up with answers to these two queries.
Let us immerse ourselves in the Starcraft 2 universe. Are the races fully united? The Terrans are obviously not, the Dominon and Raynor are at loggerheads, while Kel-Moria and some other colonies each have their own ideas as to what to do. Protoss has a bunch of different factions and friction between the light and dark templar, that's why LotV will feature Zeratul trying to make them cooperate, not to mention the Taldarim incident. Even the supposedly monolithic Zerg is not all that monolithic, the Broodmothers follow the strongest entity, which at present is Kerrigan, but they seem to have some rivalry between each other.
Now look at yourself in a custom game. What are you? A Terran commander, Protoss executor or Zerg broodmother. Probably one rather low down the chain of command. Would your boss trust you enough to give you 3/3 upgrades and all special abilities researched right at the start? Would he/she allow you to grow your army without any limitations except how much resources are in your area? Of course not. If you are Terran, you might get strong enough to break off and start your own power group, or worse, join the other factions, and he might get executed. A Protoss might conceivably get over aggressive towards the other tribes (or depending on his leader's wishes, not aggressive enough), while a Broodmother might decide she is strong enough to attempt a coup d'etat or splinter away, they are after all programmed to follow the strongest.
Obviously, even leaders from the same race cannot trust each other fully.
Think of it, if they really wanted you to win the war, would they just give you a mining building and 6 workers at the start? Of course they would give you a large army right? Hence we can see that these skirmishes which we call custom games are really of no impact to the great war between the races, they are just battlegrounds for rank and file commanders (us) to prove our ability and loyalty, and hopefully get promoted.
So coming back to the game, say you are a Terran commander. Your marines actually have the upgrades programmed into their suits and rifles already, but they are not active yet, the combat shields are built into the back of the suit, but are locked into place and cannot be taken out. Once you complete researching the upgrade, the release code is sent to them, enabling them to use upgrades and combat shields. So what is the purpose of the upgrade? The truth is that an emissary from your boss is sitting inside the engineering bay, so when you give him his "processing fees" of 100 minerals and 100 gas, he starts to process your request, which takes up the research time. After he has finished checking your loyalty and filling in the necessary papers, he stamps the paper of approval, upon which the release code is sent out to your armies and they can use the upgrade. This also explains why higher level upgrades are more expensive - obviously the processing fees (bribe) has to be larger for nicer stuff.
The same thing is done for Protoss and Zerg, just via psionics. Basically the "limiter" is just released upon approval.
Once we think of it in this vein, the 200 supply limit is logical: nobody wants their subordinates to get too strong suddenly. Having a supply limit is kinda sensible for Protoss and Terran in a way as they actually have to allocate personnel to their leaders, while for Zerg it makes no sense to have a limit as their soldiers are grown on the spot. The only possible explanation is that Kerrigan doesn't want any individual Broodmother to get too strong and possibly turn rogue.
This logic also explains some other questions about Starcraft.
1. Why do we have to use Ghosts to target nukes into place? Surely Terran technology can shoot missiles to a target location without a Ghost targeting right.
Answer: The Ghosts actually serve as the executive officer to authorize nuclear targeting, as we know they go through Ghost school so they have been brainwashed to be loyal. If you tell them to target Dominion assets they will refuse to comply and will report you in.
2. Why can we only have one Mothership?
Answer: The Protoss are notorious for controlling their superweapons. They had Mothership and Colossus tech all the way back in Starcraft 1 but didn't want to hand it out to commanders. They don't even let you use the purifier cannons on the carriers in game! (maybe for fear you purify a planet that the higher-ups later plan to colonize). Now they have relaxed a little bit, but still limit one executor to one Mothership.
3. Why can't Protoss repair units?
Answer: Protoss bureaucrats are really the most money-grubbing folks in the Korprulu Sector. Everything is already built on Aiur, but they are adamant on receiving payment before warping them over to you. Even when a couple stalkers could mean the difference between life and death for you they WILL NOT SEND THEM WITHOUT PAYMENT. No promissory notes accepted here.
So, do you really buy that a race as advanced as the Protoss cannot repair their units on the field? Obviously its because they don't let Khalai mechanics repair on the field, so that Protoss commanders have to send more money home to buy new machines of war.
4. Why can't we build the Leviathan in single-player?
Answer: If Kerrigan handed it out to everyone it wouldn't be as valuable right?