We accept all Windows updates on a monthly basis, which is followed by an automated reboot the following weekend during off-hours.
No, we've never had any issues with Windows updates on our JDE servers.
That being said, we have had issues with some Office updates on workstations running the BI Publisher Microsoft Word add-in.
There are windows updates, and then are windows updates. You need to be selective.
All of the monthly security patches, apply monthly. Big updates like service packs? Use more caution. Make sure they are supported by your tools release. If that are supported, then apply them to your non prod servers and test. Once they have baked in a while, apply to the prod servers.
Watch out for IE patches and java patches. You can get in a pickle with those. Even though Oracle owns java, they don't keep e one and it's various components current. If you're on an AS400 and running websphere, be extra careful to stay with a supported java. Keep your developers fat clients on a supported java. Otherwise, things can get messy.