I have never thought about just updates, but I'm fairly certain that the updates apply to the actual application folders, not user settings folders, which would mean the updates would have to affect all users on a single machine. At least that's the way it is with installing a new program, at least most programs including Office. It's also the way it works with Windows Update, so I can't see why it wouldn't be with Office Update.
Another example. Where I work, they run updates via scripts out to all machines, and to do so, they at least usually have to login as specific administrator account. After the updates have taken place, then the software I use is updated, even though I wasn't logged in for the updates.
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"If to err is human, then I must be some kind of human!" -Me