You can't ignore rules in the code although they may be rendered not applicable. In this case, the objective is to account for situations where both series rated devices are not "truly" in series as determined by their fault sources, and hence need to interrupt an additional portion of the fault currents without aid from the other device.
Keep in mind, this type of rating system applies to the branch currents seen by the protective devices and not the fault current at the bus. Also note that its a bit trickier to apply multiplying factors to the branch current to account for asymmetry when performing the device evaluation.
I don't see why not.
They don't. IMO upstream/downstream are ambiguous terms because what may be considered downstream for normal operation could be considered upstream in terms of fault generation... I believe the original series rating concept was "Cascade" systems/ratings.