I'm not sure what's this all about?
From what I know, MS has released Automatic Update blockers to
companies. This is for those who don't want Automatic Update to
automatically update anything in their company's PCs and creating
havoc.
For those who wanted to block IE7 from installing... you would have
come across MS IE7 Update Blocker. That's basically what the
Automatic Update Blocker is about.
Implemented successfully, there should be no more updates to the
user. I'm pretty sure it worked, at least for me.
Now... regarding this part:
Users of other in-beta Microsoft products, including Windows XP
SP3, which is still in limited testing, will also be hit by the
Office update, which weighs in at almost 220MB.
I believe this includes all kind of software under MS
Connection. I'm in the Windows Live Testing team and others,
obviously I'm hit.
I haven't check with my friends, but I don't think I've seen any
Automatic Updates scheduled for them.
Not on other testing team, can't verify if it's true, other than
the Office 2007 update.
Earlier this week, when Microsoft unveiled the service pack, it
said Automatic Updates (AU) would not be used to deliver SP1 for at
least three months, and maybe as many as six months.
This part - just me lucky? I've not received any update
notifications. 
Must be some of idiotic settings again. Haha. 