Here is an extreme example of what can happen if you delayed updates. Extreme meaning this person hasn’t updated since March 2019. But it is just an example.
It can happen if you miss 3 stable update cycles, or maybe you’re lucky with 5 cycles, or maybe you’re unlucky and it was 2 cycles missed. It really depends what changed in Manjaro’s repo and what you have installed yourself.
No, linux-latest meta package is determined by the Manjaro team. It’ll probably be updated to kernel 5.11 in the future. It was on kernel 5.9 previously, which isn’t LTS.
The reason to have linux-latest installed is for users to not have to manually install the newest kernel every time; they can just let the Manjaro team decide when you get the newer kernel on your computer. The Manjaro team can just update the package to tell the package manager to install the newer kernel, i.e. 5.8 → 5.9 → 5.10