Your screenshot confirms it — App Updates is missing, and you’re right that App Downloads is a different setting. Apple’s current iOS 27 guide says App Updates should appear under Settings > Apps > App Store. Change settings and restrictions in the App Store on iPhone - Apple Support
I’d check Settings > Screen Time > Content & Privacy Restrictions > iTunes & App Store Purchases and make sure Installing Apps is set to Allow. Then restart the iPhone and check the App Store settings again.
If Content & Privacy Restrictions is already off and App Updates is still missing, I wouldn’t start signing out of your Apple Account or resetting the phone. At that point it looks like the setting itself isn’t being displayed correctly, and I’d contact Apple Support.
→ How to manually update apps from the App Store - Apple Support