Hi Adam,
I've only seen the specific error from your log once before, and in that case the root of the problem was a third-party web security gateway that was between the SEPM and the Internet. Is such a device in place on your network?
13/09/2011, 0:22:42 GMT -> Progress Update: PATCH_DOWNLOADING_START: Number of patches: 8
13/09/2011, 0:22:43 GMT -> HttpSendRequest (status 503): Request failed - Server is temporarily overloaded.
13/09/2011, 0:22:43 GMT -> HttpSendRequest (status 503): Request failed - Server is temporarily overloaded.
13/09/2011, 0:22:44 GMT -> HttpSendRequest (status 503): Request failed - Server is temporarily overloaded.
13/09/2011, 0:22:45 GMT -> HttpSendRequest (status 503): Request failed - Server is temporarily overloaded.
.....
13/09/2011, 0:22:54 GMT -> Progress Update: PATCH_PROCESSING_FINISH: Number of patches: 8, Num successful: 0
13/09/2011, 0:22:54 GMT -> EVENT - SESSION END FAILED EVENT - The LiveUpdate session ran in Express Mode. LiveUpdate found 8 updates available, of which 0 were installed and 8 failed to install. The LiveUpdate session exited with a return code of 1806, LiveUpdate downloaded all of the updates you requested, but was unable to install any of them.
Configure the proxy/security device (if one is present) to allow all traffic to and from liveupdate servers on the Internet. That might allow this SEPM to succeed.
Please do update the thread with your progress! I am curious about this case.