So anyone who regularly checks Microsoft Update with Office installed has been living in pain for the last few months due to various performance related issues that result when attempting to scan for updates via MU.  Well the WU team has released this blog with the steps you can take to fix this problem (sort of): http://blogs.technet.com/wsus/archive/2007/05/15/srvhost-msi-issue-follow-up.aspx

I tested  the MSI hotfix + AU3.0 client in my XPSP2 / Office 2003 VPC this morning and SVCHOST.EXE was pegged at 100% for almost exactly 10 minutes - but the scan did complete successfully and unlike before - I could actually use the VM and alt-tab around and launch apps (they must run the threads at below normal priority now so as to share the CPU better).  Yesterday this same VM was taking > 25 minutes to scan and it would actually time out intermittently.