Testing has revealed that the silent update that Microsoft pushed last month can cause problems for users of Windows XP who run a repair installation. This involves booting from the CD and choosing the option to repair the existing installation when the system won't boot or blue screens. The repair will run normally, and after the repair, Automatic Updates is set to Automatic by default. XP then downloads and installs version 7.0.600.381 of several Windows Update client files.
The problem is that seven DLL files fail to register, and as such, all further updates fail. This issue was discovered and reported by Scott Dunn at Windows Secrets. The usual fix for broken updates is to reinstall the client, thereby re-registering the DLL files. However, in this case, Microsoft has not released a KB article or an installer for the new files. The fix is to manually register the DLL files. You can use the following commands in a batch file to get automatic updates working again:
regsvr32 /s wuapi.dll
regsvr32 /s wuaueng1.dll
regsvr32 /s wuaueng.dll
regsvr32 /s wucltui.dll
regsvr32 /s wups2.dll
regsvr32 /s wups.dll
regsvr32 /s wuweb.dll
Once those files are registered, updates should begin working normally again.