Run setup.exe any time you want to update or install a Cygwin package. The signature for setup.exe can be used to verify the validity of this binary using this public key.
When installing packages for the first time, setup.exe does not install every package. Only the minimal base packages from the Cygwin distribution are installed by default. Clicking on categories and packages in the setup.exe package installation screen will provide you with the ability to control what is installed or updated. Clicking on the "Default" field next to the "All" category will provide you with the opportunity to install every Cygwin package. Be advised that this will download and install hundreds of megabytes to your computer. The best plan is probably to click on individual categories and install either entire categories or packages from the categories themselves.
The latest net releases of the Cygwin DLL are numbered 1.n.x, where "n" is currently "7" (e.g., 1.7.5). The 1.n.x version numbering refers only to the Cygwin DLL. Individual packages like bash, gcc, less, etc. are released independently of the DLL. The setup.exe utility tracks the versions of all installed components and provides the mechanism for installing or updating everything available from this site for Cygwin.