AirWatch can replace an internal application or it can deploy multiple versions of the same internal application. Replacing a retired version or having multiple versions depends on the Actual File Version value.
If you want multiple versions of an application, do not select the Retire Previous Version check box on the Details tab. This check displays when you add a new version of an application. AirWatch assigns the higher Actual File Version to devices and the lower Actual File Version remains assigned, too. If all versions are Active, then multiple versions work.
You can Deactivate application versions to remove them from the retiring process and from device assignments.
It does not matter if Apple iOS versions increment up or down. AirWatch can still assign multiple versions to iOS devices.
See Internal App Versions in AirWatch for more topics on Versioning.