I've noticed strange behavior with Software Update too. I think what happens is that there are two kinds of "updates" that the program checks for.
(1) What version of (OS, app, etc) do I already have installed, and is there a newer one available... in which case it installs the newer one.
(2) Today a new (OS, app, etc) was released and I'm going to assume that it isn't installed, so let's install it.
The second type I described comes from personal experience, since on days that new software is released, I often run Software Update, but then afterwards I run it again, just to make sure I got everything new. Sometimes it wants to install the item I just installed (Safari in particular comes to mind). I just cancel it, and then next day if I run it again it doesn't do this strange thing.
I can only assume that Panther's version of Software Update will work better, as rumors suggest it is going to be improved in some way.