I too have this problem.

When I try to connect to LIVE from within H2V, it says "No profiles found." So I tried selecting create new blah and when it jumped to IE to the web page to create a new LIVE account, I alt-tab back into H2V to get to the LIVE browser and enter my LIVE account email and PW. I get a screen that says,

"Downloading profile. This may take a few minutes blah blah..."
There is what looks like it might be a progress indicator bar towards the bottom of this screen but it never moves. That screen goes away after about 10 seconds and I get a screen that says,

"Update required. An update is available for this game from LIVE."
I click on "Yes, update now." I now get a screen that says "Update in progress" with the same immobile progress indicator for about 10 seconds. Then it says,

"Update failed. Can't download the update. Make sure that you are connected to the internet. If the problem persists, go to www.xbox.com/support."
Yes, I have disabled my other network adapter.
Yes, I have moved the remaining network adapter to the top of the binding order.
Yes, I have tried reinstalling Halo 2 Vista.
Yes, I have downloaded XLiveRedist1.0.6027.msi it run it - it runs without complaints.
Yes, halo2.exe is listed as an exception in the firewall with no limits on the scope.
Yes, TCP port 3074 is open in the firewall with no limits in the scope.
Yes, this computer connects to the internet. I'm posting this aren't I?

Does anyone have any nuggets of wisdom to offer?

No LIVE means no multiplayer, and no multiplayer means I'll taking this game back.

Thanks,
woof