I have just found that 'cryptographic services' is listed as a component service
For the description of the service it says:
Provides three management services: Catalog Database Service, which confirms the signatures of Windows files; Protected Root Service, which adds and removes Trusted Root Certification Authority certificates from this computer; and Key Service, which helps enroll this computer for certificates. If this service is stopped, these management services will not function properly. If this service is disabled, any services that explicitly depend on it will fail to start.
If this is disabled it might cause that error.
To check go to Control Panel/Administrative Tools/ Component Services and under the status it should say 'started'
It might have been disabled during your last successful SP1 update
Just an idea
