I have this problem too. On my first workstation I updated from Gutsy RC to 
Gutsy Final by installing all updates. After the release got out, update 
manager reported that a new version was available and launched the distribution 
upgrade tool, which stops at the second step, saying that my system is already 
up-to-date. Well, that's fine with me, but today I got it again, while there 
were no "normal" updates.
On my second workstation I installed Kubuntu Gutsy from the release cd from the 
18th of oktober, and it has the exact same issue.

Safe to say that the RC was more stable than the final, as both the
upgrade tool and kopete are broken in the final, while the weren't in
the RC.

-- 
Kubuntu 7.10 Upgrading to Kubuntu 7.10 and after gives error and says 
Distribution is Up To Date
https://bugs.launchpad.net/bugs/154771
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