UPDATE: Fixed! As of Mac OS X 10.8, Software Update is no more and has been replaced with the App Store which doesn't have this particular flaw.
If I've learned one thing in 25 years of computing, it's that you can't trust a progress bar when installing software. I appreciate the complexity around that problem. But this needs to be fixed:
As you can see here, the installation is all but finished, but the dialog is still showing that it is installing 6 items. Instead, it should be indicating the number of items that are left to install, updating the display as it goes.
What's particularly frustrating about this is that the Finder gets this right. When you are copying or deleting files, the Finder displays a progress bar but also displays a count of the files that are left to be processed. As files are being copied or deleted, that number ticks down to zero. Why Software Update doesn't repeat that pattern puzzles me. There's no chance I'm going to trust that progress bar, so it should least indicate the number of packages left to install.