10.8.3 update will not run - keeps asking for restart
Assuming you have checked and the system isn't actually running 10.8.3 (Open About this Mac and look under OS X for the current version), you might find it easier to download the combo updater and try that to update your iMac.

It writes to /var/log/install.log (as well does the Mac App store) and you will have a clear indication after running the Combo Updater as to the cause of failure as well as whether the Mac App Store failure was similar or different.