Problem Updating Xcode 4.1 to 4.2
Downloading Xcode from the AppStore actually downloads an installer package. I can't remember exactly where this downloads to since I've already moved mine to a backup drive in case I need to reinstall, but it's most likely /Applications.

Once this is downloaded, you need to run the installer to actually update your Xcode installation. It should be titled something like "Install Xcode.app". Run that and you should be OK.

You've likely downloaded that package 3 times already though, so check your /Applications folder before downloading it again. :)