1. It invoke the program called wupdmgr.exe, which pull a windowsupdate.asp webpage from MS V4 server(at least for my testing version of XP)
2. The .ASP page then download a cabinet file called IUctl.cab onto your machine.
3. wupdmgr.exe checks the updated verions of two dll files called IUctl.dll and IUengine.dll against the versions in your machine.
4. wupdmgr.exe will update any version older than build 1106 of these two files to build 1106.
5. wupdmgr.exe with these two dll files would then pull another webpage called GETMANIFEST.ASP which checks many things, including serial key/productID combinations on the target machine.
6. wupdmgr.exe refuse to update windows it pirated version(such as DO) found(at present), and close all dll and wupdmgr.exe
The funny part is when such procedures are carried out pre 9/9/2002 which is the release date of the XPSP1, MS still slips in the SP1 version(1106) of the files IUctl.dll and IUengine.dll
What MS could do is at anytime if she wish, slips in bew versions of IUctl.cab(hence IUctl.dll and IUengine.dll) onto a machine which requesting the windows updates. So, the lesson to be learn here is stop using the DO version totally, or never hit 'windows update' against if you insist on keep testing the DO. Cos, MS might have already investigated and data pooled the pirate keys in PreSP1 era, only to be use in a later stage at her discretion, such as diabling the XP installation or otherwise.
Be aware.

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