Here is some interesting things I found out with our testing.

I built another VM today that is very similar to our production box (OS: Windows 2000 Server SP4 and all security updates). I then installed SQL 2000 and added SP2 which is what it was running at and as far as I know no additional hotfixes. I made sure the server was had all updates applied. We pulled a backup copy of one of our databases and restored it in the test environment (that way I was working with valid data). After this was setup I took a snapshot of the VM (W2K3SP4 - SQL2KSP2). I had them test our application and as expected no issues. I then installed SP4 for SQL2000 and took another snapshot of the VM (W2k3SP4 - SQL2KSP4). I had them test the application again and failure. I then went and installed the HOTFIX that I downloaded from Microsoft for the issue (KB901212). I installed this hotfix which took it to build 2184 and then took another SNAP (W2K3SP4 - SQL2KSP4 W/ Hotfix : Build 2184). I had them test it and the application was working. So then I wanted to see what happened if I let WSUS apply any additional updates after that and as expected it applied (KB948111 - since I was running build 8.00.2148) and I took another SNAP (W2K3SP4 - SQL2KSP4 W/ Hotfix and KB9481111 : Build 2272). I had them test it again and it failed. I then went back to my SNAP (W2K3SP4 - SQL2KSP4 W/ Hotfix : Build 2184) and had them test it again to check if the issue was fixed. This works.

If I install update KB9481110 then I can not apply the Hotfix for KB901212 because the application thinks it is already installed but the application is broken.

If I install SP4 and then install the Hotfix directly for KB901212 which takes it to build 2184 the issue is fixed. However as soon as I apply KB9481111 from WSUS the appliction is broken again.

Any ideas?