Hi All,
It took me a while to cut this one down. I created a blog post on my website with detailed instructions and links to the updates you'll need to download. It'll take you about 10 minutes and you should have Windows Updates working again.
http://www.geekallday.com/windows-xp-sp3-update-issues/
I'll also list the updates here that are required.
- Microsoft .NET Framework 3.5
http://www.microsoft.com/en-us/download/details.aspx?id=21 - Internet Explorer 8
- Update for Windows XP (KB927891)
- Windows Update Agent 3.0
http://technet.microsoft.com/en-us/library/bb932139.aspx - Security Update for Windows XP (KB2510531)
http://www.microsoft.com/en-us/download/details.aspx?id=10367 - Security Update for Internet Explorer 8 for Windows XP (KB2797052)
http://www.microsoft.com/en-us/download/details.aspx?id=36574 - Security Update for Internet Explorer for Windows XP (KB2799329)
http://www.microsoft.com/en-us/download/details.aspx?id=36418 - Cumulative Security Update for Internet Explorer 8 for Windows XP (KB2898785)
http://www.microsoft.com/en-us/download/details.aspx?id=41404