The issue still does not appear to be resovled. After doing additional research I want to see if I understand this correct:

KB948111 which is the patch I applied is only going to install updates 8.00.2148-8.00.2272. (I have gathered this from reading another post and what is stated in the FAQ on for KB948111)

http://www.microsoft.com/technet/security/Bulletin/MS08-040.mspx

I believe the Hotfix that I need is for SQL Server 2000 build 8.00.2145 (901212 (http://support.microsoft.com/kb/901212/ ) FIX: You receive an error message if you use the sp_addalias or sp_dropalias procedures when the IMPLICIT_TRANSACTIONS option is set to ON in SQL Server 2000 Service Pack 4

http://support.microsoft.com/kb/894905/

KB948110 had installed by WSUS which patched it to build 8.00.2250 but it would not allow me to install the HOTFIX for build 8.00.2145 when the update was already installed.

So do I need to remove the HOTFIX for KB948111 which should take it back to 8.00.2050. Then reboot the server. Next unstall HOTFIX taht will take it to build 8.00.2145 (KB901212). Reboot the server if needed and then install KB948111 which should take it back to build 8.00.2272 but will include the fixes in 8.00.2145.

I hope this makes sense.