How to tell why an update is not applicable

There is no way to determine if any given update is going to be needed by any given system except by either allowing the Windows Update Agent to scan the update after publication to the WSUS server, or directly investigating the criteria for the update to be applicable. For each update in the Software Publishing node tree, you can view the configured rulesets in the console. The Update Titles are usually descriptive enough to identify the probability that an update might be needed.

You can publish updates as metadata only, which is an efficient way to get information on which updates are actually needed. You can also publish updates in bulk; however, to publish a collection of updates as metadata only would require setting the content type value on each row of the package list in the Publishing Wizard. Here's a series of articles that goes into some more detail on this subject.

How the Windows Update Agent determines the status of an update

Thanks, your answer pointed me in the correct direction for troubleshooting.

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