This morning I received notice from Microsoft about a potential issue with WSUS 3.0 - specifically installations that serve updates to clients running Office 2003. If you are running Office XP or Office 2007 this issue *should not* impact you. I say *should not* since this is a new issue, and also because sometimes you'll have Office 2003 binaries on your system thanks to 3rd party software dependencies, in upgrade scenarios, etc. Also, I have not experienced this issue myself - even though I have a handful of test machines running Office 2003.
Update 1: Microsoft has an official blog post regarding this issue on the WSUS Product Team Blog. I've removed the details from my earlier post since you can find them at the source. I'll continue updating this post with my own findings and those of the community. Feel free to post in the comments section if you have first-hand experience with this issue.
Update 2: I looked at the Office 2003 SP1 revisions on my WSUS server and found something odd. Take a look at the date of the 2 most recent revisions:
I'm not saying this is the root cause... but it sure seems strange to me. Stay tuned for more info.
Update 3: Just heard from Cecilia Cole (WSUS Program Manager). Apparently the date typo in my update revisions screen shot isn't an issue since the update is expired. Cecilia and team are also working on an updated blog post and KB article to address the scenario(s) where you might run into this failed detection issue. Let's just say it looks fairly rare and should not be keeping you up at night.