Did you do this? WindowsUpdate is not shown as a trusted site in your HijackThis log.
To view and download updates for your computer, Windows Update should be listed as a Trusted Site in Internet Explorer.
To add Windows Update to the trusted sites zone:
On the Tools menu in Internet Explorer, click Internet Options.
Click the Security tab.
Click the Trusted Sites icon, and then click Sites...
Uncheck the "require server verification" checkbox.
Make sure the following URLs are listed in the Web Sites list box:
Spybot S&D, and SpywareBlaster both have options to diable ActiveX for security reasons. If so, you need to add windowsupdate to your trusted sites fot it's activex components to work.