I cannot change windows update settings for my computer despite being administrator of computer. The dropdown list is greyed out. I am running Windows 7 Ultimate x64.
If you have uninstalled any antivirus software recently (specifically McAfee/Norton), see if the vendor provides a special complete removal tool. Google will help here.
Visit this site: http://support.microsoft.com/kb/971058
Now, according to the source, you should run the fix it tool first in default then in aggressive mode. Personally, it didn't give me that option, but just run it and see how it goes.
There are also alternative instructions on the KB article if you do not wish to run the fix it tool.