Yeah, it's false positive, and one that should have been caught well before the update was made. So? I have an F-Secure version that insists Adobe Acroreader is part of some kind of nefarious plot, and has for several releases of their update files.
Pretty much every AV software has had false positives. This one is somewhat funny in that this false positive hit an important part of MicroSoft's operating system, but if it weren't for that, this would not be newsworthy.
If people didn't react with such a vigorous knee-jerk when their software detects a "virus" (ZOMG! burn the computer - it's InFeCTed!), things would be better. I like how TFA suggests disconnecting your computer so that AVG can't update ...