Hello,
According to your description, the error seems met by few people. So first I consider that it may be related to the size of the Recovery Environment's partition. The Windows Recovery Environment (WinRE) is used to repair or recover from issues affecting Windows. You could find the information and steps in the link below. Try to manually resize your partition.
Windows 10, version 21H2 | Microsoft Learn
If the issue still insists, try to reset Windows Update Component and repair .net framework component.
1.Type “Control Panel” into the search bar and open it.
Go to “Programs” > “Programs and Features”.
Find Microsoft .NET Framework from the list, click on it, and select “Uninstall/Change”.
In the new window that appears, select “Repair .NET Framework to its original state” and click “Next”.
Once the repair process is complete, restart your computer and try updating again.
2.Try to reset Windows Update components manually by following the steps below:
Additional resources for Windows Update - Windows Client | Microsoft Learn
Best Regards,
Hania Lian
If the Answer is helpful, please click "Accept Answer" and upvote it.