Updates are free. Do you mean "upgrade" ? eg Vista to Windows 7, for which there is a charge. If it's been offered by email, either way, ignore. ( An upgrade isn't anywhere near that costly, anyway).
There aint no windows update or upgrade on the market that costs that much! Its a con!
Updates are free from microsoft and can be downloaded off the microsoft website. Windows 7 the full operating system on dvd can be bought in the shop brand new with licence key for around 60-80 quid at the moment.