It isn't necessary to flash your drive with the latest firmware. In general I recommend not flashing unless you are experiencing some problem that might be improved by updated firmware. Although not common, problems can occur during a flash upgrade, and such problems are generally not covered under warranty:
LG Readme file wrote:Improper processing of this upgrade will damage the drive. LG Electronics is not responsible or liable for improper installation of this upgrade.
One problem that might make an upgrade worthwhile is bad burn quality on the media available to you (e.g. slower than expected burn speeds, excessive errors, etc.) Another reason to upgrade firmware is if the new firmware adds as a feature such as Mt. Rainier support that your current firmware does not provide.
In this case I think the firmware is a media compatibility update, so I wouldn't bother updating unless you are having trouble getting good quality burns with the media available to you.
If you do decide to update, download the firmware from the above link (assuming you do have the GCE-8520B, which I believe that you do). Unzip the update executable. Make sure there isn't any disc in your burner and that you don't turn off or reboot the computer while upgrading (either deliberately of by an accidental power-outage - a UPS is nice to have while flashing). Start the upgrade by double-clicking the GCE-8520B104(win).exe file. The update should proceed automatically. If it doesn't, select your burner in the "Target Drive" box and click "Upgrade". Make sure you don't pick the wrong drive.
When the upgrade is complete the flasher will display a dialog saying "FIRMWARE UPDATE SUCCESSFUL". Click OK and then reboot.