Let me ask you a few questions. If you run wyUpdate.exe alone, does it properly check & update? What's the version of wyUpdate.exe (right click, click properties, the click the details tab). Was the AutomaticUpdater & wyUpdate working before?
If I were to guess I would say this problem is caused because the "client.wyc" file isn't included with wyUpdate.exe. When you build wyUpdate make sure you include both the wyUpdate.exe and client.wyc files with your app.