Uh, are we talking about the same update, KB971033?
More information about this update
This update for Windows Activation Technologies helps detect validation errors and activation exploits. This update also detects any tampering attempts made to important Windows 7 system files. Be aware that some counterfeit copies of Windows include malware.
When this update is installed, it performs a validation process for the copy of Windows that is running on your computer. However, this validation process does not affect the functionality of Windows. The update process exits silently if it detects no validation errors, activation exploits, or tampered files.
It has nothing to do with Office 2003 Sarah? If is specifically for Win7.
Interestingly, I found this on the web :
When you are installing updates over the next week or so be aware that Microsoft has finally released their anti-piracy update (KB971033) which can cause issues for many Windows 7 users, even those who got their copy of Windows 7 legitimately.
To quote: "For those of you who have a pirated copy of Windows 7 or have bought your computer from Dell, Best Buy or Gateway where Windows 7 was pre-installed you may want to stay away from this update.
While it isn’t supposed to make your operating system unusable, it will keep asking you to pay for it and will also make your wallpaper a boring blank solid color.
So before you decide to just install all of your updates when you shut down your computer make sure you check to make sure the file isn’t downloaded and ready to install. This is of course if you did not install the operating system yourself or pirated it."
Note the warning above? I have a DELL and it was NOT automatically d/l'ed. My Dell came with Vista x64 and I purchased the MS Upgrade so I have a valid license, but it somehow (Windows Update) knew not to automatically install, still sitting there as an additional 'important update is available'.