When I finally decided to update this computer to 64 bit windows 7, I had the same problem, wouldnt update. I had to hand feed it one update at a time especially the ones that dealt with the windows update system itself before it started to go on its own. Even then I could only install one update at a time then had to restart the computer otherwise if I tried to install a second or let it search for them itself, the update program locked up and wouldnt search for any.
I went online and lost count on how many boards I read talking about patches, fixes, and other tweaks to get it to update properly. One of them finally did it and now it works like it should especially when I went to skuzzys thread and removed and blocked the updates that will choke out the computer, especially the one that blocks windows 10