Suggestion: uninstall the updater, then use Firefox to install it.
I had this problem on a new computer a couple days ago with a clean installation of the latest Java 7 and Internet Explorer. I cleaned things out and tried again using Firefox, and the updater installed with no problems and works perfectly. All I can conclude is that IE's joined Chrome on the list of browsers that just don't do Java correctly.
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"Hey! I'm not illiterate. I had a book once. ...could've used some ketchup though..."
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