The locale archive creation code within meta/lib/oe/package_manager.py create an archive and removes locale packages (glibc-binary-localedata-*). However, this breaks package upgrades in my distribution. I am using RPM. This is because the there is a dependency between locale-base-en-us and glibc-binary-locale-data-en-us, for example. I have a local patch which adds a variable which disables the archive generation and locale archive. This is okay for me because I am using a low number of locales and there is not much space savings. Another fix might include modifying glibc changing the DEPENDS to a RRECOMMENDS. There would have to be upgrades of archives outside of the package manager, however.
This was fixed on the master branch. lib/oe/package_manager.py was converted to a module/directory lib/oe/package_manager/__init__.py. The patch applies, so I've submitted it to the mailing list.
Fixed with: https://git.yoctoproject.org/poky/commit/?h=dunfell&id=35bcc28983205e42941541f3133f3ddc2124b2d6