Testmonkey,
I'm not entirely sure what logic is used when the NavData.db3 database is autopopulated, but I am almost certain that existing records are not overwritten if they contain at least registration and type codes. This is obviously to prevent records that you have manually updated being overwritten and I cannot see how this could be any different. It would be inadvisable to automatically add data for empty fields in already populated records.
I think that pictures download is attempted for all records that contain a registration, as it is the registration that is used to search airliners.net. I find that the only time a photo fails to appear is when there is no photo available at airliners.net - I stand to be corrected here, but that's my impression.
With regards to the 37,000 records with only Mode S, registration and short name, I suggest that you back up your NavData.db3, delete all the partial records as you suggest, and see what happens. You can always go back to your original file if you need to.
I just wonder how many of those partial records are still "active" aircraft. I've got 624 aircraft showing in the Network list right now and only 9 of those with registrations are missing the company name in the list. In MyFlights, out of 83 aircraft shown, only one company name is missing. Obviously, this is probably going to vary depending on where you are in the world and how complete the records were for that country when they were added to the database.
Having used both the SBS-1 and RadarBox, there seem to be two schools of though regarding databases. The SBS-1 comes with no database at all when you first install it, and population depends entirely on a 3rd party program to give you anything other than Mode S codes. to a point this is good, as it allows the database to be populated as you pick up aircraft - however, it does mean that you have to have an internet connection to populate the database in the first place. To counter this, some SBS-1 users download worldwide databases to populate their database, resulting in thousands of aircraft that will never ever be detected as they don't have access to Network aircraft data.
RadarBox takes a different approach, providing a comprehensive aircraft and route database that allows RadarBox to be used right out on the box - if you excuse the pun :-)
I think the fact is that no database is ever going to be 100 percent accurate and for most users this isn't a problem. For me it's fun to manually correct the odd "live" aircraft record - I don't bother correcting Network aircraft records unless it's something I'm particularly interested in.
Anyway, I look forward to the results of your experiments, let us know how it goes.