Your 1726 error from DISM might be related to having an anti-virus or firewall program running while running DISM.
I have invested close to another 8 hours into this today and have made no headway. I have shutdown Windows Update services, deleted the c:\windows\SoftwareDistribution and C:\windows\cbstemp folders, restarted the Windows Update services, and then tried installing this update again. Same failure.
I just tried running the DISM command that was recommended. It took ~2 hours to reach 100% and then gave this error:
Error: 0x800f081f
The source files could not be found.
Use the "Source" option to specify the location of the files that are required to restore the feature. For more information on specifying a source, see https://go.microsoft.com/fwlink/?LinkId=243077.
To say that I am disgusted with Microsoft and its low-quality software development practices is a gross understatement.