Thanks to all the list members for their many helpful references.
Almost all of these pointed me towards literature on the use of
temporal Bayes nets.  I am investigating these, but the question I was
trying to ask, but not clear enough about was the following:

In conventional, non-temporal diagnosis, how do we come up with
acceptable networks.  Here's a made-up example of what I want:

Consider a hypothetical (implausible) immune system disease, D.  D has
the strange effect of striking its victims at the extremities first,
then progressing inwards.

A patient presenting in the early stages of the disease might present
with symptoms like "infected hangnail," and "gangrenous toe."

A patient presenting in late stages of the disease, though, would be
like a late-stage AIDS patient, riddled with opportunistic
infections. 

I could imagine a (non-temporal) Bayes net for this diagnostic problem
having two disease hypotheses:  "D early stage" and "D late stage."
"D early stage" would cause "infected hangnail," and "gangrenous toe."
"D late stage" would cause "infected hangnail," and "gangrenous toe,"
but also "pickled liver" and "watery lungs" (via "pneumonia").

My question is, has there been any thought about principled ways to
choose how to introduce hypotheses like these?  How do we know that we
need two diagnostic hypotheses for D, or three or four, as opposed to
27?  (Perhaps in medicine this is just part of the empirical wisdom of
the field.)

Also, has there been any thought about incorporating "late stage"
disease diagnoses with other hypotheses in a single diagnostic engine?
I.e., having a hypothesis that effectively can explain ANY observable
symptom?

The issue relates to my original question of how to diagnose failures
of devices that have feedback, since if a failure persists for some
time in such a system, that system will start displaying "late stage"
symptoms --- the tight coupling of the system will cause malfunctions
to appear everywhere. 

Best,

Robert

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