Break update functions into update.inc

watching

I would suggest a defined constant like HOOK_SCHEMA_VERSION that defines the latest N of hook_update_N where HOOK is replaced by the module name.

I would suggest a file hook_N.schema where N is the latest hook_update_N number, hook is replaced by the module name and that this file is included from within hook_schema and that hook_schema be modified to accept the schema version.

define('FOO_SCHEMA_VERSION', '7000');

function foo_schema ($schema_version = FOO_SCHEMA_VERSION) {
  $schema_file = "foo_${schema_version}.schema";
  include $schema_file;
  return $schema;
}

The hook_N.schema file would not contain a function but only the $schema definition.

  $schema['foo'] = array(
    ...
  );

In the hook_update_N one could then include the schema file by calling the hook_schema implementation and then using it's own version of the schema.

function foo_update_7001(&$sandbox) {
  $schema = foo_schema(7001)
  db_add_field('foo', 'col2', $schema['foo']['col2']);
  return t('Added col2 to table foo.');
}

This in general will keep the install file smaller and also allow for tracking the changes to the schema in separated files. The hook_update_N could then be separated into hook_N.update files allow each update to be included individually. The update system would know where to begin and then end with HOOK_SCHEMA_VERSION. So a file foo_7001.update would be included that defines the foo_update_7001 function and then is executed.