kat

It's unlikely that a virus would come in on a genuine windows update, was your popup thingie a genuine windows update?

Is your scan showing lots of xyz.exe files (where x,y,z are different letters) in C:\Windows\System32? If so, that's a genuine problem.

Depending on what AVG does with them, you could try the following - empty the virus vault, then reboot your system, then rerun the scans (antivirus and antimalware).

If AVG removed it your new scan will probably be clean. If it's not removing it, or if it's removing only currently active copies, you'll probably find it's come back in the second scan.

If it does come back, post again and I'll see if I can help.

Mick