Software update always fails due to "unknown error"

When I attempt to install software updates on my Macbook Air the process always fails with an error message that says "unable to install due to unexpected error" (or something like that). Any ideas how to fix this problem? I've found some references to this problem in the discussions but the proposed fix didn't work for me.
Bruce

Nov 12 10:37:29 Bruces-MacBook-Air Software Update[986]: JS: 10.7.4
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM ->T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: inHostDiskUDS=0x10ad36c20=disk0s2=Macintosh HD inWhatStr=RecoveryInfoBaseSystemVersion
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM ..T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: did get booterRecoveryUDS=0x10ad36ae0=disk0s3=Recovery HD
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM ..T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: did mount nobrowse; MP=/Volumes/Recovery HD OMS=0x7fdf6a5067f0
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM ..T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: getting dict from file=/Volumes/Recovery HD/com.apple.recovery.boot/SystemVersion.plist
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM ..T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: got dict (or NULL=will return err): oooInfoDict=0x7fdf6c006f00
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM ..T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: did if-needed-best-effort unmount
Nov 12 10:37:30 Bruces-MacBook-Air diskmanagementd[1006]: DM <-T-[DMToolBootPreference recoveryPartitionInfoForVolume:what:dict:]: retErr=0 outInfoDict={
        ProductBuildVersion = 11E2702;
        ProductCopyright = "1983-2012 Apple Inc.";
        ProductName = "Mac OS X";
        ProductUserVisibleVersion = "10.7.4";
        ProductVersion = "10.7.4";
Nov 12 10:37:30 Bruces-MacBook-Air Software Update[986]: JS: 10.7.4
Nov 12 10:37:31: --- last message repeated 1 time ---
Nov 12 10:37:31 Bruces-MacBook-Air Software Update[986]: JS: Firmware is up to date.
Nov 12 10:37:31 Bruces-MacBook-Air Software Update[986]: JS: model = MacBookAir5,2
Nov 12 10:37:31 Bruces-MacBook-Air Software Update[986]: JS: 10.7.4
Nov 12 10:37:37: --- last message repeated 4 times ---
Nov 12 10:37:37 Bruces-MacBook-Air Software Update[996]: Acquired Lock: 501, 986, 0
Nov 12 10:37:37 Bruces-MacBook-Air Software Update[996]: Releasing Lock: 501, 986, 0
Nov 12 10:37:41 Bruces-MacBook-Air Software Update[986]: Calculated need 5167.634 MB; 91316.322 MB free; 91316.322 MB available with MTM reclaim
Nov 12 10:37:50 Bruces-MacBook-Air Software Update[996]: Acquired Lock: 501, 986, 0
---- download, install and reboot started here -----
Nov 12 11:12:15 Bruces-MacBook-Air Software Update[986]: Calculated need 3686.898 MB; 89835.094 MB free; 89835.094 MB available with MTM reclaim
Nov 12 11:12:15 Bruces-MacBook-Air Software Update[996]: Releasing Lock: 501, 986, 0
Nov 12 11:12:18 Bruces-MacBook-Air Software Update[996]: Acquired Lock: 0, 1060, 0
Nov 12 11:12:20 Bruces-MacBook-Air installd[1061]: PackageKit: ----- Begin install -----
Nov 12 11:12:20 Bruces-MacBook-Air installd[1061]: PackageKit: request=PKInstallRequest <5 packages, destination=/>
Nov 12 11:12:20 Bruces-MacBook-Air installd[1061]: PackageKit: packages=(
        "PKLeopardPackage <file://localhost/Library/Updates/041-6215/FlashbackMalwareRemover.pkg>",
        "PKLeopardPackage <file://localhost/Library/Updates/041-6259/MacBookAirMid2012SoftwareUpd1.0.pkg> ",
        "PKLeopardPackage <file://localhost/Library/Updates/041-6725/MacBookAirandMacBookProUpd1.0.pkg>",
        "PKLeopardPackage <file://localhost/Library/Updates/041-7916/MacOSXUpd10.7.5.pkg>",
        "PKLeopardPackage <file://localhost/Library/Updates/041-7916/RemoteDesktop.pkg>"
Nov 12 11:12:20 Bruces-MacBook-Air installd[1061]: PackageKit: Skipping component "com.apple.ColorSyncUtility" (4.7.4-4.7.4-235011000000000-*) because version 4.7.5-4.7.5-235012000000000-* will also be installed.
--- many more lines of "Skipping component" deleted ---
Nov 12 11:12:21 Bruces-MacBook-Air installd[1061]: PackageKit: Skipping component "com.apple.iokit.IOUSBFamily" (5.0.8-5.0.8-508004001000000-*) because version 5.1.0-5.1.0-510004006000000-* will also be installed.
Nov 12 11:12:26 Bruces-MacBook-Air installd[1061]: PackageKit: Will do receipt-based obsoleting for package identifier com.apple.pkg.RemoteDesktop (prefix path=/)
Nov 12 11:12:26 Bruces-MacBook-Air installd[1061]: PackageKit: Extracting file://localhost/Library/Updates/041-6215/FlashbackMalwareRemover.pkg (destination=/var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root, uid=0)
Nov 12 11:12:27 Bruces-MacBook-Air installd[1061]: PackageKit: Extracting file://localhost/Library/Updates/041-6259/MacBookAirMid2012SoftwareUpd1.0.pkg (destination=/var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root, uid=0)
Nov 12 11:12:30 Bruces-MacBook-Air installd[1061]: PackageKit: Extracting file://localhost/Library/Updates/041-6725/MacBookAirandMacBookProUpd1.0.pkg (destination=/var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root, uid=0)
Nov 12 11:12:36 Bruces-MacBook-Air installd[1061]: PackageKit: Extracting file://localhost/Library/Updates/041-7916/MacOSXUpd10.7.5.pkg (destination=/var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root, uid=0)
Nov 12 11:13:12 Bruces-MacBook-Air installd[1061]: PackageKit: Extracting file://localhost/Library/Updates/041-7916/RemoteDesktop.pkg (destination=/var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root, uid=0)
Nov 12 11:13:12 Bruces-MacBook-Air installd[1061]: PackageKit: update_dyld_shared_cache -overlay /var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root
Nov 12 11:13:13 Bruces-MacBook-Air installd[1061]: update_dyld_shared_cache[1068] updating i386 cache because current cache file contains a different set of dylibs
Nov 12 11:13:18 Bruces-MacBook-Air installd[1061]: update_dyld_shared_cache[1068] updating x86_64 cache because current cache file contains a different set of dylibs
Nov 12 11:13:23 Bruces-MacBook-Air installd[1061]: PackageKit: Using sandbox version of /usr/libexec/xpchelper
Nov 12 11:13:23 Bruces-MacBook-Air installd[1061]: PackageKit: xpchelper --rebuild-cache --overlay /var/folders/zz/zyxvpxvq6csfxvn_n0000000000000/Cleanup At Startup/PKInstallSandbox-tmp/Root
Nov 12 11:13:23 Bruces-MacBook-Air installd[1061]: Deferred path /System/Library/PreferencePanes/.Displays/V1/Displays.prefPane/Contents/Resourc es/Dutch.lproj/DisplaysPref.nib/objects.nib is not in sandbox and will be skipped.
--- many, many more lines of "Deferred path ... is not in sandbot and will be skipped ---
Nov 12 11:13:24 Bruces-MacBook-Air installd[1061]: Deferred path /System/Library/PreferencePanes/UniversalAccessPref.prefPane/Contents/version.p list is not in sandbox and will be skipped.
Nov 12 11:13:24 Bruces-MacBook-Air installd[1061]: open on /System/DeferredInstall/Scripts/Shove: File exists
Nov 12 11:13:26 Bruces-MacBook-Air installd[1061]: PackageKit: Install Failed: Error Domain=PKInstallErrorDomain Code=114 "An error occurred while setting up files for deferred installation." UserInfo=0x7fd263b62cc0 {NSLocalizedDescription=An error occurred while setting up files for deferred installation., NSUnderlyingError=0x7fd263c16a20 "“Shove” couldn’t be copied to “Scripts” because an item with the same name already exists."} {
        NSLocalizedDescription = "An error occurred while setting up files for deferred installation.";
        NSUnderlyingError = "Error Domain=NSCocoaErrorDomain Code=516 \"\U201cShove\U201d couldn\U2019t be copied to \U201cScripts\U201d because an item with the same name already exists.\" UserInfo=0x7fd263ba9890 {NSUserStringVariant=(\n    Copy\n), NSDestinationFilePath=/System/DeferredInstall/Scripts/Shove, NSFilePath=/private/tmp/PKInstallSandbox.RfMmtE/Scripts/com.apple.pkg.update.os .10.7.5.11G63b.delta.6mH88d/Shove, NSUnderlyingError=0x7fd263c4da50 \"The operation couldn\U2019t be completed. File exists\"}";
Nov 12 11:13:26 Bruces-MacBook-Air Software Update[996]: Releasing Lock: 0, 1060, 0
Nov 12 11:13:26 Bruces-MacBook-Air Software Update[1060]: Error: An error occurred while setting up files for deferred installation. (PKInstallErrorDomain code 114)

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