Hi Mike,
I have understood that your windows explorer is crashing and you get an error message C80003FE while installing windows update.
I want to know Which updates fail to install ?
Try the following methods in order to fix the issue.
Method 1: Update troubleshooter
Run the windows update troubleshooter and attempt to install the updates
Open the Windows Update troubleshooter
http://windows.microsoft.com/en-US/windows7/Open-the-Windows-Update-troubleshooter
Method 2: Clean Boot
If he still has issues, put the computer in a clean boot and attempt to install the updates
How to perform a clean boot to troubleshoot a problem in Windows 8, Windows 7, or Windows Vista
http://support.microsoft.com/kb/929135
Note: Refer "How to reset the computer to start as usual after troubleshooting with clean boot" under more information to reset the computer to start as normal after troubleshooting.
[Note]: After troubleshooting, refer to this section ‘How to reset the computer to start as usual after clean boot troubleshooting’.
Method 3:
For further troubleshooting you can refer to this link:
Unable to install updates in Windows Vista, Windows 7, Windows Server 2008 and Windows Server 2008 R2
http://support.microsoft.com/kb/2509997/en-us
Try to follow the steps mentioned above and revert back to us with results.
Thank you