I'd be curious to hear if anyone has resolved this problem. I am only using SCUP for Flash updates, but I am having the same issue where the Flash updates install perfectly on a system imaged with the SCCM 2012 client, but fail on a system upgraded from SCCM 2007 to 2012.
I have the certificate and GPO settings configured correctly. If I didn't, the patches wouldn't install at all. So, I'm confused why it's just broken on clients upgraded from 2007.