Mahdi's Nights

I am doing a small side project on Muhsin Mahdi's 3 volume Alf Layla with critical apparatus for my language requirement.

I understand a few things about it but I'm still really confused on a major point:

What exactly is he doing here with this work? Is it a word-for-word transcription of Galland's manuscript?

Where and why does it differ?

- Yes, he finds the oldest Syrian versions and the oldest Egyptian versions and is making a composite picture of the oldest Syrian version but... how is he doing this?

I examined a page of Mahdi's frame story and it is a word-for-word transcription of the Galland manuscript but I assume that Mahdi's entire Nights is not, so why does he choose to "fill in the blanks" with missing material from other manuscripts and how does he choose which manuscripts to fill in the material with?

I am a bit confused on this point.