I do NOT have ANY AV on this PC and multiple attempts to update it make no difference.
Your screenshot shows the .exe is only 2kb in length, which of course is wrong, and this can only caused by the antivirus. Are you *SURE* you don't have any, not even the default Windows Defender, which I'm not even sure it can be uninstalled.
If you use Windows Defender, you still might have to configure it to add the whole Addon Manager folder to the antivirus Exclusions, then run the FSDT Live Update. I'd remove the corrupted Couatl64_MSFS.exe file as well before updating.