The file "C:\calc.exe" doesn't exist for me. If I change it to just "calc.exe", it launches Calculator just fine (because without a path it also looks in the windows directory).
Are you sure the file you're trying to execute exists? Is there really an update.exe in the C:\ directory? Besides, you really, really shouldn't dump files in the C:\ directory. Use the AppPath expression to keep everything inside the application's folder.