From the looks of the log file it is finding files it needs to read as being corrupted
2014-03-20 08:26:24, Info CBS Failed to internally open package. [HRESULT = 0x800f0805 - CBS_E_INVALID_PACKAGE]
2014-03-20 08:26:24, Info CBS Failed to OpenPackage using worker session [HRESULT = 0x800f0805]
2014-03-20 08:26:24, Info CBS Session: 30360514_1124961317 initialized by client WindowsUpdateAgent.
2014-03-20 08:26:24, Info CBS Failed to internally open package. [HRESULT = 0x800f0805 - CBS_E_INVALID_PACKAGE]
2014-03-20 08:26:24, Info CBS Failed to OpenPackage using worker session [HRESULT = 0x800f0805]
2014-03-20 08:26:24, Info CBS Session: 30360514_1124961318 initialized by client WindowsUpdateAgent.
2014-03-20 08:26:24, Info CBS Session: 30360514_1125430107 initialized by client WindowsUpdateAgent.
2014-03-20 08:26:24, Info CBS Failed to internally open package. [HRESULT = 0x800f0805 - CBS_E_INVALID_PACKAGE]
2014-03-20 08:26:24, Info CBS Failed to OpenPackage using worker session [HRESULT = 0x800f0805]
2014-03-20 08:26:24, Info CBS Session: 30360514_1125430108 initialized by client WindowsUpdateAgent.
2014-03-20 08:26:24, Info CBS Failed to internally open package. [HRESULT = 0x800f0805 - CBS_E_INVALID_PACKAGE]
I think the best thing to do is to do a bad sector check on the drive.
Open a cmd.exe window as administrator. Once open put in
chkdsk C: /f /r
It will try to check the disk but the disk will be in use and it will ask is you want to schedule it for next boot, say yes.
Now reboot, the system should start the chkdsk, if it doesnt try again. If it does start go have some coffee and wait. A chkdsk that checks every sector can take a while depending on the size and speed of the drive and weather it finds any bad sectors or not.
Lets go from there
Shane