I believe the key here is to understand that during a SQL Server installation, the resource database is deployed, while the master and other system databases are "built".

We know that the resource database is replaced when a service pack is applied. How does the installer know where to look for the resource database files?

Whenver you install any program, the installer keeps track of where it deploys a file. In our case, it knows where it deployed the resource database during SQL Server deployment.

If the location of these files are changed, the installer can no longer patch these files - which is why the location of the resource database cannot be changed.

This is the standard behaviour of any installer.