I have a client who are 'upgrading' their OS but tearing down the entire instance, creating a new one based on the updated AMI and creating the setup including EBS volume. When they delete the EBS volume, all the shapshots are also removed, right? So they lose any backups from the previous AMI instance?
That is not right. Snapshots are not deleted when the source volume is deleted.
Any snapshot of a volume can be used to create a copy of the volume as it existed when the snapshot was created, even after the volume itself is deleted. After a snapshot is created, it has no active operational relationship to the volume used to create it -- it lists that volume as its source, but that's the extent of any relationship. Snapshots are only deleted when you delete them explicitly.
I can certainly confirm this anecdotally, but references in the documentation are somewhat more elusive... however, here's an indirect reference: if deleting a volume also deleted snapshots of the volume, the following advice would be impossible to follow...