Hello pancakes80,
Welcome to Apple Support Communities.
We understand that you’re concerned about additional storage being used when you updated to iOS 16.3. We are happy to help.
Please us the steps here to check your storage to see what is using your storage: How to check the storage on your iPhone and iPad - Apple Support
"Use your device to check its storage
- Go to Settings > General > [Device] Storage. You might see a list of recommendations for optimizing your device's storage, followed by a list of installed apps and the amount of storage each one uses.
- Tap an app's name for more information about its storage. Cached data and temporary data might not be counted as usage.
In the detailed view you can:
- Offload the app, which frees up storage used by the app, but keeps its documents and data.
- Delete the app, which removes the app and its related data.
- Depending on the app, you might be able to delete some of its documents and data.
If your device is almost full and can't free up space, you might get a Storage Almost Full alert. If you see this alert, you should check the storage recommendations or you need to offload some less-used content like videos and apps."
If you have other storage taking up a lot of your storage, we recommend the steps here to clear other storage: Clear Other storage on your iPhone or iPad - Apple Support
"Update your device
An issue in iOS or iPadOS 13 might prevent the system from freeing up storage for you. To fix this issue, update your iPhone or iPad to iOS or iPadOS 13.6.1 or later.
If you don’t have enough available storage to update wirelessly, update your device to iOS or iPadOS 14.1 or later using a computer."
Let us know if you have further questions.
Take care.