The online kernal update doesn't correctly change the booting proceedure, so you end up with a kernal panic after detecting hardware.
This caused a minor panic this morning, and again I am so glad I have another computer to work from, even if it is only a Win98 system.
If you do the online update, you should check that in /boot, initrd is linked to the correct file (with the same ending as the vmlinuz symlink target). ie. initrd -> initrd.<stuff here>.um vmlinuz -> vmlinuz.<stuff here>.smb is wrong (and is what my system looked like).
It needs to be: initrd -> initrd.<stuff here>.smb
If you have the kernal panic, put in the boot CD, select installation, select language then select "Boot existing system" - this will create a horrible set of errors on booting, but will give you access to your system.
I'd imagine booting directly to rescue would work too, just mount the system, fix the symlink in /boot and away you go... Source of fix-it information - found with google...
*woot* I recovered my system all by myself!