Just wanted to share with anyone else who was having this issue what it was that I did to resolve it. First off some quick background, this is a brand new HP laptop so was no update over windows 7.
I first had issue updating due to a device issue with an installed HP codec that conflicted with a Windows Codec update, I resolved that and manually updated that single update. Then Windows update failed again. I tried doing the DSIM w/ Restorehealth option as suggested previously in this post, but to no avail.
Some more research led me to the following folder "C:\Windows\servicing\Packages" in this folder I did a quick search for some of the failing updates KB numbers.. (KB2727528 for example) and sure enough found the following...
Package_for_KB2727528~<blahblah>~6.2.1.0 cat and mum files
Package_1_for_KB2727528~<blahblah>~6.2.1.0 cat and mum files
Package_for_KB2727528_RTM~<blahblah>~6.2.1.0 cat and mum files
Using the following command (note that trying to remove the _1_ or _RTM results in a package not found!):
dism /online /NoRestart /remove-package /packagename:Package_for_KB2727528~<blahblah>~6.2.1.0
and recieved a 100% package removed! No way! Installed just that update and booyaah success, restarting it seemed to stall at 15% but then kept going after a few mins and success.
I then wrote out a batch file to execute the above command for any found package namefor anything that had a KB code in the the Windows Update list and viola all were removed. Windows update then completed successfully!
As my wife pointed out.. what do people who don't know computers/software as well as me do, and I told her they probably take them back for a refund, and she replied this is why people use Macs LOL! Probably true. I hope this helps someone else.
After 20+ years you'd think MS would've finally stopped releasing broken Windows software *sigh*
Doc.