I tried many different "solutions" and I was getting very very frustrated until I found this post:
"I ended up calling Microsoft and they were able to guide me through some steps and we were able to fix the issue with the update. I wanted to post these steps in case anyone else is having the same problem.
- Run sfc /scannow
- Check for Windows Updates
- Open Device Manager and update the Network Driver
- Run all updates in the Windows Store
- Run Windows Update again
- Run Disk Cleanup
- Uninstall Antivirus software
- Delete all Temp files
- Run "Prefetch" in the command bar and select all, then delete all
- Restart the computer
- Run the Windows 8.1 Update again.
Once you do all of these and then run Windows 8.1 update, your screen will come to a point where you can see the User ID and the wheel spinning. I thought that the update got stuck but is was still running. This can take a little while (est. 1-3 hrs.) to complete, so be patient and once it's done, you'll have Windows 8.1 on your computer in no time."
I found it here: http://www.eightforums.com/installation-setup/52665-windows-8-1-update-error-0xc1900101-0x40017-dell-xps-18-a.html
Good bless this guy. It solved my problem. I follow the steps and Windows 8.1 installed without any problems. FYI I have an ASUS Zenbook UX31LA. Now I only have to deal with the noisy fan, it's driving me bananas!!! (if someone knows how to fix it, please let me know).
Try blowing out the inside of your laptop with compressed air to clean your fan and vents. you fan most likely has a buildup of dust on the blade causing it to be unbalanced and have to work harder to spin , equaling a higher noise operation. If that fails, your fan is most likely old and reaching end of life/is faulty, and I would replace it.