I don't think it's related to Windows update. I think it just went south.
You can try it on another PC (not clear from your post if you need to install a driver). If that fails, it's time for a new one.
From the day I got this headset it was working well suddenly it stopped working I am running windows 7 every time I plug in the headset in the USB port I get the error message "USB device not recognized" I tried to plug it in another USB port same problem my laptop is running fine and other USB products like mouse and my ipod work well when connected
Any idea how to fix this could this error be from a windows update?