The worst part is that I have my Win 7 set to only notify me of available updates, not to download them, nor to install them. Yesterday 12/11 I was greeted by a hosed machine and the only clue was that the update screen flashed by before it died. I took it to my favorite shop (a 30 mile drive). He/they are authorized MS resellers. Recovered it within 30 minutes. He felt it was a forced update by MS.
Sleep or hibernation can cause disaster in the middle of an operation and the files can be easily corrupted and have to be removed to bring back the computer. I'm not saying that happened but I have had to repair a lot of computers that did. In my opinion those functions cause more trouble than they are worth.
Although there may be instances when "automatic", pre-set sleep times are necessary or mandated, I certainly would not advise anyone use "automatic" in the normal course of things. Certainly this could be problematic if sleep occurred in the middle of an update.
But, sleep, manually initiated, is what I use and recommend.
I don't know that "sleep" (or even more) is necessarily an issue.
Updates seems robust enough to figure out that something has happened, & to pick up from where it was before.
I've had updates occur at inopportune times, like if its a machine at work, & well, I want to leave, dammit!, I force power down the machine (holding in the power button 4.sec or so - updates be damned!), then next time I'm around the machine, hit the power button & it picks up where it was.
(Recommend doing so? Not particularly, but I've seen no ill side effects.)
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It happened in about 3 stages. I have it set to sleep automatically after 5 minutes of inactivity. It initially refused to wake, then, after changing mouse batteries, it did wake, but a screen flashed by that said it was updating windows. Don't know where that came from. Then died and refused to wake. The power supply would turn on, and fans run, but no HD activity and no screen. Like I said, my PC tech made it come to life but I did not stand and look over his shoulder and so don't know what or how he did it.