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Unable to run windows update

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So as usual I'm not really sure where to direct this question but homebuilt systems normally nets me an answer. I have a toshiba laptop and a dell 8110 desktop off the same network. The laptop is running windows vista or 7, I'm afraid I can't remember now. The dell is still xp home. I'm just cracking into the desktop to clean off viruses but it's been slow going. The laptop had no security installed at all, on arrival windows defender would not load and updates kept getting an error indicating server busy or unable to access network. I cleaned off all the viruses I could find with AVG 9 but no change. A search online yielded a few things to try but still no luck. Now working on this desktop I have the same error trying to run updates from over a year ago, the latop had not run any since october of 09. I am assuming they have either the same network setting error or virus gumming up the works but I haven't been able to find it yet.

Could anyone point me in the best direction to look short of reinstalling windows. I did manage to get defender working by deleting the registry key stopping it on the laptop. Thanks in advance, more info can be provided if you need it. XP is SP2 on the desktop.
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You most likely have the Conficker virus. It blocks access to Windows updates, and other Microsoft Web sites. It also blocks access to most anti-virus sites as well. It is nasty and tough to get rid of.

Sounds like that might be the case on this machine. I managed to manually update to windows 3 and after the reboot it started to download updates on it's own. However it was slow and still bogged down so I rebooted into safe mode and I can't seem to get it to work. I tried installing AVG to no avail. I next tried housecall but as soon as the site loaded I.E. popped up and error and killed it. I am running malwarebytes right now.

Recommendations on killing this thing?

That was the initial thing I thought I would be doing. It is a cleaning project for a family friend so they are worried about losing data. Trying to get it cleaned up, I recommended a format and reinstall to begin with but the worry is the virus would be transfered with the file backup.

Well for a followup for anyone else battling this. I managed to get panda antivirus to install in safe mode and an initual scan without a definition update cleaned off 9 viruses. After a reboot and going into detect vulnerabities in panda it was able to manually update windows. 67 updates later windows malicious software got a couple and another update to panda got the rest. It is now running nice and smooth.
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