When you use the official upgrade option, the first update installs 10586.107. You have to check for updates again and then it will install 10586.318 which is the latest official public version of Windows 10 for mobile.
After the update has installed 10586.318, you can do a hard reset (factory reset) What this does is is a clean install of the OS and removes any leftover files from the installation process. A factory reset keeps the same OS version, it will not take you back to 8.1. Factory resets can be done from settings - it helps to sort out any issues you have
To go back to 8.1, you'll have to use WDRT as you have already done
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