While researching this issue, as we have had this happen within my company with a few users. I came across the comment below.
This led me to wonder if Windows is trying to force a backup to the OneDrive with the update, if its running in the background. Because OneDrive is always running by default, yet the users aren't logged in (we don't allow users to use cloud storage), Windows can't access the OneDrive to write so the files get lost. Since I have manually disabled the One Drive on my computer it doesn't see that as an option for backing up folders when updates run. So this makes me question if there is a setting somewhere that says "if running X Windows Update, back up all personal files and settings to the OneDrive as a precaution" like a restore point.