This recently happened to me after restoring an old Macrium image to my mule PC. Verified all services & dependencies assoc w/ WU and still got same error. Problem disappeared after 3 or 4 reboots. I never checked logs for clues why it happened but it corrected itself.
Thanks for the replies everyone. I simply deleted the contents of : C:\Windows\SoftwareDistribution and started the service over. I had re-download some updates but it seems to be working now.
I had the same issue the other day, see the image file, the clue was in the highlighted area. The answer was to run windows defender via the action centre (this is of course normally turn off with 3rd party virus software) and then update it and then disable real time scanning (i.e. turn it off) After this update were working as normal.
I'm running Windows 7 and I stopped using Windows Updates. I simply don't trust them. I use the Simplix pack because it's one download and it's easy to use. If you save the exe, you can update multiple machines with it. EDIT: I forgot the customary 'YMMV'.