it sounds like a bad laser, if it would been any hardware problem i.e damaged BD-board/bad connection i think the update would have halted, as it checks the hardware and if there is any problem like no bd-drive found it will stall. But if its the laser it will check as functioning and update, but won't read discs.
replacing the laser isnt very hard, (depending on how handy you are) don't think the stores charge much either to change it, just make sure you get the right deck/laser as there is 2 different i think, old one had one lens (read both dvd/br-discs) newer drives has 2 lenses one for dvd-r movies etc, and the other for Bluray. probably they did it that way to save the BR laser when playing dvd movies etc.
hope you solves it, GL