The following is listed in the hijackthis log as running:
C:\WINDOWS\SoftwareDistribution\Download\6bb372cec f80d03ab26b01c29db4654f\update\update.exe
It's related to this msdn article:
You receive an access violation error and the system may appear to become unresponsive when you try to install an update from Windows Update or from Microsoft Update
Not sure if everything applies but it says that:
When you install the MSI fix and the new client, process-monitoring tools may still show CPU usage at near 100 percent. However, the system should still be responsive and should not lock up. If another task requires CPU cycles, they will be shared.
There's more on there and it's probably worth the read, especially the part under resolution that says:
To resolve this problem, you must install this update together with the Windows Update Agent 3.0. The Windows Update Agent Client 3.0 will automatically be released through Automatic Updates by
June 30, 2007.
All files are currently available though, you just have to download them if you think this is relevant.