[RESOLVED] false windows update?!

[judge john]

hi,
when i booted up my computer this morning i got the usual message saying that windows updates where available. so i clicked install as usual only to suddenly get a message saying i have spyware. then without asking me a program called 'spy falcon' was installed. this program would not remove and spyware as you had to pay for it. i tried to un-install it only for it to re-install again. and since then i keep getting 'balloon' messages from 'windows update' saying i have spyware and to download 'spy falcon' again. now i'm certain that some form of trojan spyware etc is pretending it's windows update and keeps installing things without my approval. also when i open up IE i get a new homepage 'http://www.necessaryupdates.com/'. and again this keeps trying to trick me into dl more stuff.
so i have ran Ewido and M$ anti-spyware. they keep picking up problems but after i remove them they seem to re-appear again. also i have ran the computer in safe mode, and the 'balloon' pop-up still appears telling me to dl stuff. i have also removed everything that shouldn't be there buy using HJT. but still no luck. any more ideas?

and hers a few screen shots to show you the problems.