Forgot to mention that the problem is not the full DOM update itself but the fact that all bound JQuery scripts, etc are lost........
You may want to post the fragments - both xhtml source as well as fragment of page source viewed which shows the hidden values. I tried to find this on my existing sample apps and could not. There must be some other s tag or possible configuration you are using for this to occur. If the hidden form field does not have an id, then yes the DOM update will apply to the entire form. If there is some other s tag that is not supplying an id (and name) on the hidden form field, then it would be desirable to correct this.