mOOzilla, this is documented behavior for SP3 and later (where SP4 = later).
If you want to disable Automatic Updates permanently, you must use Group Policy. If you're not in an Active Directory domain, you can still run gpedit.msc on a standalone machine.
First, you need to right-click Administrative Templates and add the wuau.adm template. Then, drill down under Computer Configuration, Administrative Templates, Windows Components, Windows Update. Double-click "Configure Automatic Updates" and select Disabled.
If you are in an AD domain, this can still be overriden by OU-level or domain-level policy, but otherwise your Automatic Updates setting will be preserved when applying SP3, SP4, SP5, etc.
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