Ok I seem to have to be over the hump.
McAfee and Malwarebytes seem to have got the bug...at least so far, for me in the corporate world once a machine is infected it is no longer trust worthy.
So this laptop bears watching.
The service pack 1 thing, "error 0800B0100" was resolved by renaming the folder C:\windows\softwaredistibution.
I had to stop services BITS and the windows update to rename the folder. After cranking those service back up I used windows update to apply sp1, it took a bit because I think it had to go out and figure out what updates it had and what it needed.
Good deal, I don't know what the original problem was, I figure it was a rights issue off the top of my head, but it's interesting enough that I'll keep looking.
Here is another, probably, good fix.
http://litespc.wordpress.com/2011/12/09/how-to-fix-windows-update-800b0100-errors/