I can use 'Install Software' from 'K--Menu>System>Configuration' as well as 'Remove Software' but when I try to use 'Software Updater'
the bouncing icon bounces for a while but then stops and then never opens. Also I don't have the icon in the menu panel. According to 'Remove Software' Zen-updater is installed. When I run '/etc/init.d/novell-zmd' I get these results:

# /etc/init.d/novell-zmd status
Checking for ZENworks Management Daemon: running
:~ # /etc/init.d/novell-zmd restart
Shutting down ZENworks Management Daemon done
Starting ZENworks Management Daemon done
:~ # /etc/init.d/novell-zmd status
Checking for ZENworks Management Daemon: running

What could be the problem? I have installed the 'libzypp' patch that is supposed to correct the problems with Yast/ZMD.

I had the same problems... just after an upgrade from 10.0 to 10.1... I messed about for hours but couldn't rectify the problem so I just toasted the newly upgraded 10.1/10.0 partiton and clean-installed 10.1... no problem after that.

I know that this really isn't the best advice for how to fix the problem... but hey, at least you're not alone!

Ok, my problem turned out to be much simpler and also no doubt self inflicted. Zmd and the zen-updater were working I just couldn't see the zen-updater. This turned out to be a permissions problem. Like a lot of us when I first installed 10.1 I determined that the Yast/ZMD package manager was broke so I got comfortable with Smart and forgot what I had done in Yast/ZMD. I learned again how to start 'Software Updater' by issuing the command ' 'zen-updater --help and thereby learned that I could start 'Software Updater' by 'zen-updater --no-tray' then I noticed that I had enabled in 'Software Updater>Configure>Preferences' I had enabled 'Start the Software Updater on login' both as user and as root. When I disabled this in root but kept it in user it worked. Simple.