Microsoft hasn't found a bug in the latest release of the security update. Because if there was, then when you restored your computer and installed the update again, the same thing would have happened again at startup. So I don't think it had anything to do with that specific
It's probably the cause of the background intelligent transfer service, used for windows update, that starts up everytime your computer starts. Microsoft put out a patch for this but it doesn't work for most people. So that's most likely to be cause of your startup hang. So go to: startmenu / run / type in 'services.msc' / locate the background intelligent transfer service and stop it. And also right-click it and set the startup type to disabled. And I'm sure that has to be the problem, because that's the service automatic updates uses to download updates in the background which starts up when your computer starts. And since this problem occurred in your computer with the windows update then probably this should be the answer. You can find more information here: http://www.daniweb.com/forums/thread4497.html#
Also many other people have had the same problem and solution fixed it.
Edited by genius12, 30 July 2009 - 04:53 PM.