So, a few things. Trying to let Package Control automatically upgrade caused another corrupted mess that wouldn’t load. Whatever, I’ll manually pull updates until that’s fixed, probably a Package Control issue.
Secondly, your latest update, while having the admirable effect of allowing hidden file toggling no matter the initial setting of show_system_hidden_files, also has the side effect of ignoring the setting of show_system_hidden_files. I have tried it set to both true and false, and it always shows me hidden (and excluded) files on initial open.
Actually, now on more testing, that’s not exactly true. 1) I have it set to false, always shows hidden files; 2) I set it to true, still shows me hidden files; 3) I set it back to false, and now it works like I expect. Oh wait, now it’s back to showing me hidden files, although I haven’t changed anything. So it’s a bit hard to make it stick.
I think a sensible behavior might be to treat and excluded files exactly the same. That is, excluded files are just hidden files that were hidden by the user. Then use the hidden files setting to determine whether to open showing all files or just non-hidden ones.