Hi John,
Apologize for the difficulties that you have been put through to fix this issue. Let's try some steps in order to resolve the issue. Before that I would like to know few information from your end for better understanding of the issue.
- Please confirm as to what is the KB # of the update that fails with the error code 80246002.
- Which anti-virus software are you using in the Computer? Have you tried disabling the anti-virus Software and check if that helps in fixing the issue?
Since you've already tried few basic things on your end, I would suggest you to download and run the System Update Readiness Tool from the following link:
http://support.microsoft.com/kb/947821
Let us know the status of the issue. Get back for further assistance.
I am having this problem with both my work and home PC, and following the steps above did not help.... still get error code 80246002 when checking for updates.
As an FYI, I use TrendMicro on my home PC and Kaspersky on my work PC.