Since the release of SP1 for Win 7 and Server 2008 R2, there have quite a lot of issues relating to the installation of the service pack. Apparently many are seeing boot failures after the installation of the service pack, specifically with C00000034 fatal errors. Of course, those with WSUS will be getting automatic upgrades so you don’t even have a choice in the matter. Separately, Windows 7 users applying the SP1 update package have gone into a reboot loop after encountering: “Error C000009A applying update operation 120782 of 367890”.
The strange thing about this service pack install is that unlike other Microsoft software installations, this one removes restore points prior to the installation.
Microsoft has been fairly quiet about the issue leading many to speculate that they’re not sure exactly what the cause is. They do however have a workaround for the C00000034 issue here.
Apparently some guys in India also have a solution.