I experienced this on a new install of Windows 7 SP1 on a Dell Optiplex GX270. Windows Update wouldn't work at all.
The cause appeared to be an update to Windows Update that needed to be installed first, before Windows Update would start working again. The hotfix in question is KB3138612
Download and install this via the Microsoft Catalog, perform a reboot, and this should hopefully allow Windows Update to start working again.
If this helps you or you have any insight into this error, feel free to comment below.
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