The TL works on Vista without the update (Windows 7 might be a problem, but I haven't had to figure it out yet). You just need to open up the task manager processes tab > Start the TL program from the desktop icon > right click on the termlab program in the processes list > choose "Set Affinity..." > turn off one of the CPUs. By that time the TL program is up and working.
There is another common problem that makes people scratch their head as to why their TL doesn't work... Some computers don't put out enough power through the USB ports to power a USB Termlab. You have to go buy a powered USB hub (~$20 from Best Buy) to get the TL working. It sucks because you may as well have bought an AC powered version if you have to plug it in... Mine will work sometimes off my cheap-*** laptop by connecting everything through the powered hub, but not plugging it into the AC power. It's weird, but it works.