A few things i didnt know about regarding melon and downloads, from a korean fandom account
There are three type of downloads. MP3, Flac and DCF (encrypted files that can be download by meon free club ticket holders)
It apparently used to be that flac was available in different qualitys, and every different quality resulted in its own registered download. This was seemingly changed in 2022 so regardless of quality downloaded it just registers as one download. Lossy and lossless are still registered as two separate downloads.
The price for a lossy song is 770KRW, Flac is 1100kRW. Even if one is more expensive than the other,they are still counted the same, on melon. But they say its sometimes recommended to download FLAC first in consideration of circle chart, becuase there it actually matters.
So if what they say is true, the music services might be actually reporting revenue to gaon, and not pure uls/downloads. This is the second source ive read now saying this (another post i saw said the same about downloads on bugs and circle chart)
This could explain why circle changed to digital points to begin with, they simply stopped getting the raw ul/download data from the services and instead just get reported revenue for songs. They have themselves said they equal digital points to revenue a song would make, but ive just assumed they did their own calculations based on if it was a stream or download.