As I understand it the Skyrim game cache clears when you play another game, so in theory if I play another game and then go back to Skyrim I will be forced to download 1.2 if I want to play my old saves. Is this true? I am playing off of a USB at the moment if that helps.

Bump.

False. Because you do not download latest updates to the games every time you enter the game after another.
You can't clear Skyrim cache. You can clear Xbox 360 cache. Play games you want online with latest updates, but when you will start Skyrim, then every time Xbox Live service will offer you the latest Skyrim update. If you decline - you will go offline. After playing you can relogin online and play other games with latest updates.

I remember reading sometime before the game was released that playing other games would wipe the 360 cache of all Skyrim related data. Let me look for a link.

Found it: http://www.eurogamer.net/articles/2011-11-11-skyrim-xbox-360-cleared-cache-may-increase-save-game-load-times

"Caching takes place over the normal course of gameplay, but can be cleared by playing other games or manually cleared in the Xbox Dashboard. Save game load times could also potentially take longer if the cache is cleared."

So if the patch is saved to the cache wouldn't that mean playing another game could potentially remove 1.1 from the cache?

Ok, so when you play ANY game, download an update, then play a different game, when you go back to that game do you have to download the update again? C'mon, people!

The amount of space set aside on the Xbox for patch cashing is limited. Usually if I play anywhere from 4 to 5 different games, I will have to redownload patches for the oldest game that I played first. So if you chose not to play Skyrim for a while you could lose your 1.1 patch if you play several other games that have to be patched. Best thing to do is once a day, throw in skyrim and start it, reject the 1.2 patch, then exit and play your other games.

Never had that happen to me- and I tend to switch games for weeks at a time. Maybe it's the 200Gb HDD I use.

What an arbitrary system. Hopefully we won't need to practice such ridiculous methods like this to enjoy Skyrim for too much longer.

I'm running a slim with a 350GB hard drive and I played Sacred 2 about 6 months ago..since then I've played maybe 6-9 different games, most downloading patches..and a few days ago when I popped sacred 2 back in I had to redownload the same patch I downloaded 6 months ago, so your mileage may vary...