This error indicates one of two related things: that the Windows Update service is not running or the Windows Installer platform is broken/not installed/out of date.
Click on the Start
button, then click on Run...
In the Run...
box, type cmd
and press Enter
This will launch the Windows Command Line Shell (looks like DOS)
In the Command Shell window, type the following and press Enter
:net stop wuauserv
Then type this and press Enter:net start wuauserv
Try updating again.
If that fails, then try this:
Go to the Add/Remove Programs
control in the Control Panel
In the list of programs, see if there is an entry for Windows Installer 3.1
(you will need to check the box that says "Show Updates")
If there is an entry, then uninstall Windows Installer 3.1
Visit the Windows Installer
download page and download the installer.
Run the installer to reinstall Windows Installer 3.1
Reboot, see whether that fixed the problem.