Update fails (0x80070005)

I have the yellow shield telling me that an update has been downloaded and is
ready to install (KB885836). So I clicked to install and it goes through the
usual initialisation process but the installation fails.( Incidentally, my
Installation history tells me that this update was successfully installed on
Dec 16th 2004)

Here are the last few lines of the log:
2004-12-30 00:32:21-0000 776 434 Successfully initiated download for 1
updates
2004-12-30 00:32:21-0000 776 434 Successfully initiated download for 1
updates matching criteria 5
2004-12-30 00:32:21-0000 776 434 WU client calls back to search call
AutomaticUpdates with code Call complete and error 0
2004-12-30 00:32:21-0000 776 434 WU client completed and deleted call
{38E714B8-9B17-4E9C-94DD-94F0187BEC23}
2004-12-30 00:32:21-0000 776 434 WU client executing call
{0D388C37-5840-417E-9D43-FE8FFE90AB7A} of type Download Call
2004-12-30 00:32:21-0000 776 434 Dumping out update 1 of 1
2004-12-30 00:32:21-0000 776 434 title = Security Update for Windows XP
(KB885836)
2004-12-30 00:32:21-0000 776 434 dumping updateId
{BBE805EE-2CF7-4110-9BE8-4FE32B144E5A}.100 bundling 1 updates
2004-12-30 00:32:21-0000 776 434 bundled update No. 1 is
{A13230F5-0B6A-4857-9E4E-6B5FC174A319}.100
2004-12-30 00:32:24-0000 776 434 WU client persisted 1 download calls
2004-12-30 00:32:24-0000 776 434 WU client persisted 1 download calls
2004-12-30 00:32:24-0000 776 434 REPORT EVENT:
{EF9859BC-701C-4545-B1E6-1DE85AD63C9C} 297 2004-12-30
00:32:17-0000 1 182 101 {BBE805EE-2CF7-4110-9BE8-4FE32B144E5A} 100 80070005 AutomaticUpdates Failure Content
Install Installation Failure: Windows failed to install the following update
with error 0x80070005: Security Update for Windows XP (KB885836).
2004-12-30 00:32:24-0000 776 434 REPORT EVENT:
{31DB9F10-1549-44B8-9174-58FD905234B1} 298 2004-12-30
00:32:17-0000 1 182 101 {A13230F5-0B6A-4857-9E4E-6B5FC174A319} 100 80070005 AutomaticUpdates Failure Content
Install Installation Failure: Windows failed to install the following update
with error 0x80070005: Security Update for Windows XP (KB885836).
2004-12-30 00:32:24-0000 776 5e8 Download complete for all calls
2004-12-30 00:32:24-0000 776 5e8 WU client calls back to download call
{0D388C37-5840-417E-9D43-FE8FFE90AB7A} with code Call complete and error 0
2004-12-30 00:32:24-0000 776 5e8 WU client completed and deleted call
{0D388C37-5840-417E-9D43-FE8FFE90AB7A}
2004-12-30 00:32:24-0000 776 5e8 WU client persisted 0 download calls

I tried to test the download and install with another non-security update
but it also failed to install.

I'd be glad of any advice as this is the first time updates have failed.

Colin.