I've seen both ways done (reposting and editing existing chapters with an author's note alerting to the edits), and here's what I'll say on the subject.
If your story is going to be radically different or contains so much more information that readers would need to read from the beginning again, then go ahead and publish the new version. You'd want to still put a notice/update chapter on the existing story, but explain why you're posting the story again and include a link to the new version. Some people would even put a sample of the changed text in a spoiler in the update, just for comparison's sake, but that's entirely optional.
The next thing you can do is go back and edit the existing chapters to match what you're wanting to do for overall quality. Still post an update that changes have been made and why they were made, so that readers can go back and re-read what they need to. The obvious downside of this is that your chapters may be much longer/shorter than what they originally were and could mess with the pacing as you go through and make all the necessary changes.
There is a bit of a "hybrid" option, but this would be more difficult, I think. Upload your revised chapters while deleting the old versions and deleting any chapters that would deviate from your new/revised story path. Like the others, you will need to post a chapter to explain what you're doing and why you're doing it but this comes with a secret advantage. You're essentially posting a new story without needing the novel to be approved by Tony or anyone else, similar to a normal edit/revision. You can call it "editing/revising" but if it's going to be so different that it's almost a new story, then you've circumvented the normal posting process because, technically, the novel has already been approved.
