One of the first things that I do with a new Windows system, whether on a new computer or after I install it, is to totally turn off automatic updates. But most MSFT customers don't know that you can do this, or how to accomplish it, if they did want to. And most of them are not as paranoid as I about having stuff put on my computers that I don't know about. MSFT EULAs would seem to give them the legal right to read anything on a computer running their Windows OS, and that is frankly scary to me, in my belief that sometimes my interests and those of Redmond sometimes diverge.
That said, it does appear that at least as late as Windows XP, Windows Update wouldn't be updated without permission if no updating is selected, since I have occasionally had to update this feature before I can update the rest of Windows.