I have had the problem with msfupdate not pulling any updates. But haven't had time yet to figure out a fix.
About your error, I had this once when I forgot to start the metasploit service before running msfconsole. Did you by any chance forget to start the service? But if the service was started and you are still getting the error I would probably start by uninstalling metasploit and pulling it again from the repo's.
