<UPDATE>John Bigg brought to my attention a hotfix Microsoft recently released for Windows Installer 3.1 v2: http://support.microsoft.com/kb/916089 that fixes this specific issue. Thanks John!</UPDATE>
You may have noticed since switching to Microsoft Update to get your updates, that your computer is unresponsive after startup when you have Automatic Updates enabled. You’ll also experience this problem when connecting to the Microsoft Update site. Task Manager will show near 100% CPU usage and extremely high Disk I/O for the svhost.exe process. Running tasklist /SVC from the command line will show that the matching PID contains the wuauserv service. The only known current solution, is to revert back to Windows Update. The problem manifests itself in the fact that Microsoft Update will search all cached installs on your local PC; a very CPU and Disk intensive process.
To revert back to the standard Windows Update, connect to the Microsoft Update site. On the left pane, click “Change Settings”. In the next window, scroll down to the “To stop using Microsoft Update” section and select the “Disable Microsoft Update software and let me use Windows Update only” checkbox. Click “Apply Changes”.