I am having the same problem with SP2 as you reported back in APR. Any luck getting that error pop up msg. to stop appearing?
the error msg. references update.exe.mdmp and appcompat.txt
I tried to install Windows Updates again; Now all I get is a [pop up] menu saying that Windows has to close because of (c:\docum~1\user\locals~1\temp\wer5e2f.dir00\update.exe.mdmp)?
I am using Windows XP H E. Service pack SP2.
PS: I need to stop the pop ups, and get my files in order?