The file that is downloaded is an exe file, copy that to the actual system (doesn't have to be avast folder) you want to update and double click it, that should install the update.
I personally haven't tried this so I don't know if you could simply plug in the usb flash drive and execute the exe file, in theory it should work as XP just sees it as another drive. Give it a try and let me know if it works without copying to a normal drive folder.