On the second Tuesday of each month Microsoft releases a series of new updates to Windows. In most cases it is a good idea to install them as soon as possible. Unfortunately there are situations where installing an update can be very problematic for your system.
This specific issue seems to only affect users of Windows 7 who have installed the KB3004394 update. It does not cause problems on Windows 8 or 8.1. Microsoft has even released a patch that will help to remove the update if you’ve already installed it.
What exact problems can you expect? Unfortunately Microsoft has not listed all of them so the only way to get an idea is to see what problems users are reporting. One of the bigger issues was reported by Robert Hallock of AMD who says the update can prevent the system from installing new graphics drivers.
If you are having issues installing a GFX driver, remove Microsoft update KB3004394 from your system. Broken update; prevents driver install
— Robert Hallock (@Thracks) December 12, 2014
Other issues reported by users include a failure to launch Windows Defender, problems with running VirtualBox and some oddball errors from User Account Control.
If you are not running Windows 7, no need to worry about this error. Windows 7 users should either avoid installing this update if it has not already been installed. Users who have already installed it should uninstall it. While this updates are typically released to protect you from security holes, this one does more damage than good. Microsoft will likely release a new update in the future to plug the security holes without causing all of the problems.
While you can use the patch mentioned earlier to remove this update, you can also remove it manually by going to Control Panel | Programs | Programs and Features | View Installed Updates, right-clicking on KB3004394 and selecting Uninstall.