I tried something completely different, and it worked for me. (I had GarageBand '11 installed on Snow Leopard from an iLife DVD Apple sent me for free a few weeks after I bought my Mac Mini. Since then I've upgraded to Lion and Mountain Lion through the App Store. But I hadn't really used GarageBand until recently, which is when I discovered that some Loops and Instruments were missing.)
Anyway, I tried first the "Download Now" option, then the "Download Later" option. But neither worked. Software Update from the Apple menu found nothing.
But running software update from the command line worked. (Perhaps it uses the pre-Mountain Lion version, and that's why it works. I am not sure.) It's just two steps.
Open a terminal and type at the prompt:
sudo softwareupdate --list
You will be prompted for your password. (You have to be an administrator.)
After a while, I got this output:
Software Update Tool
Copyright 2002-2010 Apple
Software Update found the following new or updated software:
* GBExtraContent-1.0
Instruments and Apple Loops for GarageBand (1.0), 1170290K [recommended]
At least if you get the line containing GBExtraContent-1.0, you may proceed. Otherwise I do not know. Perhaps retry with the "Download Later" option from within GarageBand before trying this command again. (Or try the next step anyways.)
Now, at the prompt, type:
sudo softwareupdate --install GBExtraContent-1.0
The update should now download and install. It will probably take a while. Afterwards, restart GarageBand and you'll be able to use all the loops and instruments.
/MTP