Unable to update Windows - neither online or offline

I reinstalled Windows and suddenly i am unable to get any windows updates. I tried to update online but when select "check for updates" it stuck on "checking for updates" and that's all. I waited about hour and a half but nothing happened. And during that time, in the Task Manager, i see a process svchost.exe with parameter -k netsvcs that loads the cpu over 50% all of the time and taking most of the RAM memory on my laptop with 2GB of RAM so i am unable to do anything else during that time. I didn't get any error messages, just "checking for updates" message.

Then i decided to try to update Windows offline and downloaded the updates with WSUS WSUS Offline Update - Update Microsoft Windows and Office without an Internet connection. But when i started the update it displayed a command prompt window and it came to the phase when it say: "Listing ids of missing updates" and it stuck in the same way when i selected "check for updates" for online update. And i see the same svchost.exe process to load the cpu in the same way and taking as much RAM.

My system drive is encrypted with TrueCrypt but i don't think this may cause problem with the windows update.

I run System Update Readiness Tool and it installed one hotfix successfully.

I run sfc scan and it didn't find any errors.

This is the CBS.log file.

I frequently run into this problem lately. Normal times for the first update to really show activity are over an hour. This is what happens when MS won't issue an SP2. I would wait two hours at least before pulling the plug. Also, make sure you're using the latest WSUSo, as there's an addition that makes scanning faster. That's the first thing I would try.

I managed to install the offline updates but it took more than two hours. Why is it installing it so slow?
And why i am unable to receive updates online? It seems that lot of people have this problem recently. Does microsoft update servers overloaded?

I guess the updater is calculating dependencies, and when you have well over 100 updates it gets burdensome. But MS is more interested in moving forward than servicing Win7 with an SP2. Another trick is to try online during off hours.