Hi Dennis As stated above the Intel Driver must be updated. Remove the existing installation of the Intel driver from programs and features. Install the latest one from Intel , the download file is listed below.  Intel® Graphics Media Accelerator Driver  
Hi, I tried to use Windows Update to install SP1 with no success. Troubleshooting page identified the following problem: Windows 7 SP1 will not appear in Windows Update if update 2454826 is not installed. Windows Update will not offer you update KB2454826 if you are using one of the following Intel integrated graphics drivers:    My Inspiron N7010 has the 64-bit version 8.15.10.2104 which is apparently preventing SP1 from installing.  I could not find any updated drivers on Dell's support page and Intel says to use the Dell drivers.  Any hope for a solution? Thanks, Dennis 
Windows 7 SP1 failing to install due to driver issue