The version he has here has both. The burst from mystic didnt go away, and its arguably increased since it scales with spirit and the upgrade is a spirit item.
The upgrade gives your bullets a chance to explode, applying bonus weapon damage and spirit damage. When mystic shot is ready, you get mystic shot damage, plus the bonus weapon and spirit damage guaranteed.
I dont see how this isnt a burst item.
Sure the upgrade helps with "farming" but that depends on how big the radius of the explosion is.
It also applies team fight pressure and could potentially be super broken on someone its not intended for necessarily like a haze or wraith. They might not want Mystic shot, but the upgrade plus some fire rate would be insane on these characters in bursting someone down as well as in a team fight (again depending on radius of the explosion).
When I first saw this item, farming never even crossed my mind.