Post courtesy of David Moen of on the list.  Thanks David for letting me share this!

Here’s the process for removing/reinstalling it correctly in SBS2008.  Sorry about the formatting of the instructions, cut and past into notepad or word or something and it will be more legible.

First Attempt to Uninstall WSUS 3.0 through Programs and Features
1.    Attempt to uninstall “Windows Server Update Service 3.0 Sp2” from Programs and Features in control panel.
If you don’t see WSUS sp1 or sp2 in Programs and Features run WSUSSetup.exe from the SBS 2008 Recovery CD #2
Cdrom<drive>: \CMPNENTS\WSUS\WSUSSetup.exe and select the three check boxes to remove WSUS.
2.    If you get errors look at the WSUSSetup.log file.
C:\User\Username\AppData\Local\Temp\WSUSSetup.log and  WSUSCa_100719_1452.log
3.    After removing the Wsus within Program and Features you may want to still verify that the below directories and registry keys are removed successfully.
If you’re unable to uninstall with the setup then manually remove  the installation with the following Steps:

Important This section, method, or task contains steps that tell you how to modify the registry. However, serious problems might occur if you modify the registry incorrectly. Therefore, make sure that you follow these steps carefully. For added protection, back up the registry before you modify it. Then, you can restore the registry if a problem occurs. For more information about how to back up and restore the registry, click the following article number to view the article in the Microsoft Knowledge Base:
322756  How to back up and restore the registry in Windows

(Susan Comment:  Standard section that if you blow up the registry you probably blow up Cleveland)
Delete the following Directories and Registry keys:
4.    HKLM\Software\Microsoft\Microsoft SQL Server\WSUS
5.    HKLM\Software\Microsoft\UpdateServices  
6.    HKLM\software\Microsoft\windows\currentversion\installer\userdata\s-1-5-18\products
Look under Each GUID > InstallProperties  
On the right side look for a <DisplayName> with Microsoft Windows Server Update Services 3.0 SP<x>
Delete the GUID
7.    HKLM\Software\Classes\installer\Products\25B648799C414CF4EB36EF60FA054124
(Look through each GUID.  The default GUID for WSUS is 25B648799C414CF4EB36EF60FA054124)
 On the right side look for a <ProductName> with Microsoft Windows Server Update Services 3.0 SP<x>
8.    HKLM\System\CCS\Services\WSUS:  and others
9.    HKLM\System \CCS\Services\WSusCertServer
10.    HKLM\System \CCS\Services\WsusService
11.    HKCRoot\wsuscertserver.certmanager
12.    HKCRoot\wsuscertserver.certmanager.1
13.    HKCRoot\wsuscertserver.Utilites
14.    HKCRoot\wsuscertserver.Utilites.1
15.    HKCR\wsuscertserver.certmanager
Delete the following from IIS:
16.    WSUS Administration Virtual Directory
17.    Application Pool > WsusPool
18.    Reboot the server
Rename the following folders:
19.    Stop the “Update Services”  service
20.    C:\Program files\Update services
(Delete everything in the Update Services folder but leave the “Common” Folder)
21.    C:\WSUS  (Be sure to rename on all drives)
Reinstall WSUS from CD or Download WSUS 3.0 Sp2
22.    Option 1
Download of Windows Server Update Services 3.0 SP2 site:
Option 2
Get the SBS2008 CD2 navigate and run Cdrom<drive>:\Cmpnents\Wsus\WSUSSetup.exe
23.    Select radio button for “Full Server Installation Including Administration Console”
24.    Choose the drive that you would like for the installation to be Installed.  <drive>:\WSUS
25.    Choose the drive for the Database option of <drive>:\WSUS
26.    Select Next until you get to the Database usage.  Choose the “Create new database”
27.    Select Next all the way to the End of the installation.
Custom Configuration Wizard
28.    Walk thru Windows Server Update Services Configuration Wizard
29.    On the Language Page leave the Default check for English.
30.    Select “All Products” check box.
31.    On the Classifications page select the following check boxes
•    Critical Updates
•    Definition Updates
•    Security Updates
•    Service Packs
•    Update Rollups
32.    Set the Synchronization to Automatic
33.    Uncheck the “Begin initial Synchronization” checkbox.
34.     Select Finish.  
Open WSUS Native Console
35.    Expand your Servername > Computers > All Computers
36.    Right click on “All Computers” and select “Add Computer Groups
Here you’ll create three groups with the following name:
•    Update Service Excluded Computers
•    Update Services Client Computers
•    Update Services Server Computers
Open SBS Console
•    Look at the Updates and you should have a green Check.



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