Sourced from http://www.theregister.co.uk/2010/02/11/ms_bsod_update_glitch/
Microsoft Comments about it here http://social.answers.microsoft.com/Forums/en-US/vistawu/thread/73cea559-ebbd-4274-96bc-e292b69f2fd1
I can confirm that this does happen - hit one of my boxes today. Full text from story below.
Applying the latest patches from Microsoft can cause Windows XP machines to crash with the infamous blue screen of death.
Updating systems with the MS10-015 bulletin, which addresses "important" vulnerabilities in Windows Kernel, can cause machines to lock up when restarted before falling into a never-ending reboot loop. The problem is far from isolated, judging by a growing thread on the topic on an official Windows support forum here - though it's fortunately not commonplace either.
Restarting affected systems in Safe Mode reportedly doesn't seem to help. Suggested fixes for the problem involve booting from a Windows CD or DVD and starting recovery console before uninstalling the MS10-015 update. Uninstalling all 11 of Tuesday's Windows-related updates, as initially suggested by some users, now seems to be unnecessary.
The issue was first reported by security blogger Brian Krebs on Wednesday here. The SANS Institute's Internet Storm Centre began tracking the problem on Thursday afternoon. Microsoft is yet to comment on the issue but can be expected to publish some sort of updated advice before the end of the week, if previous form is any guide.
It's still unclear why affected systems throw a wobbler while other near-identical Win XP PCs chug along quite happily after the updates are applied.
Misfiring updates from Microsoft that cause more grief than the problems they are intended to solve are rare but far from unprecedented. The latest example, as some previous incidents we recall, happened when Microsoft issued an unusually heavy Patch Tuesday featuring numerous updates. Multiple tweaks and security fixes at one time creates a recipe for trouble, it would seem.
Security firm Sunbelt advises users to hold off the MS10-015 update. It also advises enterprises to consider applying updates in phases, just in case one of a large batch of patches turns out to be problematic.
Presenter, Techie, Geek