I am a huge fan of WSUSoffline. It does a great job of scouring the target computer for exisiting updates and only installing the ones that are required. It also has the built in ability to reboot and continue the installation for those updates that require rebooting. To avoid UAC under vista and 7, it will automatically create an admin account without UAC and reboot to that for the updates and then remove that account at the end for cleanup. Also option for installing Windows defender with definitions and MSE with definitions.
All you have to do is either start it from your external drive or DVD within windows and sit back and watch it do its magic. You will see it load, answer all the annoying MS questions and then shut down and reboot and continue. I could not survive without it.