Any of the dead Hero's equipped items or some of their gold. You will never find a scroll, potion, or seed of any kind in a Hero's remains so it shouldn't affect or relate to Scroll of Upgrade generation. However, as the items found in a Hero's Remains retain their upgrades you can find a Short Sword or Wand of Magic Missile with +1. Last time I found one, either 0.5.4b or 0.5.4c, I was able to Reforge/Disenchant it and upgrade another weapon/wand. How this might affect / tie into Scroll of Upgrade generation I can't even guess.

0.5.4c? Oh, thanks for the warning, I was not aware of that hotfix (please don’t hesitate to update the “Update” and “Update/0.5” articles).

So theroeticly, if you strip down your hero to just say, their cloth armor, then die. They will drop it? So if you are end game and know you can't take on the next boss, just get rid of everything but heavily upgraded ring or something, go to floor one then die of hunger? And you'll find it next play through? 

See Hero's remains.

Thank you kind sir.

Fantastic! Thanks Ethaniel.

I noticed that scroll of upgrades spawn most commonly in flooded fault (if there's one in a stage) 

Consider it the other way: When a Scroll of Upgrade is generated for a given floor (the probability does not depend at all on the presence or absence of Flooded vaults or any other feature), then the possibly generated special rooms with high value prize (like Flooded vaults) will receive in priority the scroll. Same thing with Potion of Strength.

ok, thanks Ethaniel! ;)

All has shared a nice information and the probabilty of finding a scroll is good enough for an information.