Hi Krobo

This is what you should try

IF you have PANDA antivirus or firewall installed on your pc, please read these pages.

Panda Antivirus Titanium 2005
http://www.pandasoftware.com/support/card.aspx?idSolucion=&idProducto=&idNecesitoAyuda=&idDeseo=&id=21043&IdIdioma=2

Panda Antivirus Platinowm Internet Security 2005
http://www.pandasoftware.com/support/card.aspx?id=21234&IdIdioma=2&ref=SopMonPlan

Or you can try this solution.

1. Press Start, choose "this computer".
2. doubleclick on "Local Harddrive (C:)".
3. doubleclick on "Windows" folder.  (is called "WINNT" in Windows 2000)
4. doubleclick on "System32" folder.
5. rightclick on "CatRoot2" folder, and choose "rename".
6. type in "CR2OLD" (without the quotemarks), and press "ENTER".

Re-reg following .DLL files:

1. Open CMD (by pressing START, choose "RUN", type "CMD" and press ENTER).
2.  type   regsvr32 JSCRIPT.DLL   and press ENTER, and press OK.
3.  type   regsvr32 MSXML3.DLL    and press ENTER, and press OK.
4.  type   regsvr32 ATL.DLL       and press ENTER, and press OK.
5.  type   regsvr32 WUAPI.DLL     and press ENTER, and press OK.
6.  type   regsvr32 WUAUENG.DLL   and press ENTER, and press OK.
7.  type   regsvr32 WUAUENG1.DLL  and press ENTER, and press OK.
8.  type   regsvr32 WUCLTUI.DLL   and press ENTER, and press OK.
9.  type   regsvr32 WUPS.DLL      and press ENTER, and press OK.
10. type   regsvr32 WUWEB.DLL     and press ENTER, and press OK.
11. type   regsvr32 QMGR.DLL      and press ENTER, and press OK.
12. type   regsvr32 QMGRPRXY.DLL  and press ENTER, and press OK.
13. type   Regsvr32 WINTRUST.DLL  and press ENTER, and press OK.
14. type   Regsvr32 SOFTPUB.DLL   and press ENTER, and press OK.
15. type   Regsvr32 INITPKI.DLL   and press ENTER, and press OK.

And finaly renaming "SoftwareDistribution" folder.

1.  press START, choose RUN, type "Services.msc" and press OK.
2.  Find "Automatic updates" services.
3.  rightclick on it, and choose STOP.
4.  now find the "Background Intelligent Transfer" services.
5.  rightclick on it, and choose STOP.
6.  press START, choose RUN, type "%systemroot%" (without the quotemarks) and press OK.
7.  Find the "SoftwareDistribution" folder, rightclick on it and choose RENAME, type  OldSD and press ENTER.
8.  press START, choose RUN, type Services.msc and press OK.
9.  Find "Automatic updates" services.
10. rightclick on it, and choose START.
11. now find the "Background Intelligent Transfer" services.
12. rightclick on it, and choose START.
13. Reboot your PC and test Windows Update again.