Your $49 tune up special should have terms and conditions that keep you from sinking hours
into a machine like this one and risk not making any money at all on it.
You can try tweaking.com's windows AIO repair but honestly the windows update service just plain
stinks on ice. I've found that once I get a system fully updated, and ensure that it has at least 4GB of
ram (like to go with 8 GB at least personally... some people resist), then the updates service isn't so
bad. I normally have to do a stand alone SP1 install and then use WSUSoffline to get the system close
to being updated other wise the built in update service at best is stupidly slow and at worst exhibits the
behavior where it sucks up basically all available system memory while it's running. That will make the
machine run like pure crap.
The part that is bothersome to me is the ram consumption. Check to see if it's a svchost that is hogging
the memory. If it is, try killing it and disabling windows update then reboot. If you don't see the ram usage
spiraling out of control then it's the update service at fault like I talked about.
1 bad sector doesn't really bother me, I don't think that's of relevance.