What java version are you using? You could try to install a new version of java and point the Mx Console to this version.
That is quite early in the update process. I think the first part of the process creates a zipped backup of your current deployment and saves it in the Backup directory of your installation location. You might check if the zip file is being produced correctly, or if it fails by monitoring this directory during the update process. If it fails during this backup process then I would try a manual zip of the model, run and web folders to see if any file names are causing an issue.