I recently reinstalled Windows 7 on my gaming box. Before doing this I saved the Steam folder on another partition using the official guide given here so I did not have to re-download all the stuff.
When I started Steam from the new location, a lot of my games were listed in yellow and their status read ‘Download paused’. I configured them to auto-update (which was disabled by default for all of them for some reason after the reinstall of Steam) but when I right-clicked them and chose ‘Resume update’ they just switch back to ‘Update paused’ a second later.
Solution: It turned out that it was due to file ownership issues. The solution was to take ownership of the steam folder and give my user access rights to it so Steam could run the updates.
Hint: Taking ownership manually is an annoying process in Windows 7 and there are shell extensions around which allow you to right-click a folder in the Explorer and do it with a click. Just google for them and install one of them if you think you need to do this for more than 2 or 3 folders.