>I've seen worse - specifically, an update pushed out to WSUS on SBS 2003 last month (April's Patch Tuesday) that basically caused WSUS to completely fail. Not to mention another patch in November 2006 that caused all workstations at one of my clients to lock up.
I am not too familiar with WSUS. I understand that this tool is useful for maintaining multiple workstations at once. In my case, I do not have that need.
>According to another Google hit, some people report success by first uninstalling KB976569, then installing KB974417, then re-installing KB976569:
http://blogs.msdn.com/joy/archive/2009/11/20/kb-953297-and-kb974417-fails-to-update-through-windows-update.aspx (in the comments).
I will wait for a few more updates in hope that this will be rectify. Otherwise, I will have to use that route.