I like the way it was done in Mac OS X with just two options available: "Install" and "Not now".
Choosing the "Not now" option will postpone update for some time (users were able to configure the delay in System Settings, AFAIR), pressing "Install" will install immediately.
So, your solution is almost the same, except two last items, which, I think, is unnecessary.
The idea behind a postpone is to not distract user from urgent tasks, but introducing additional options will lead to the opposite effect, especially when it's about figuring out something (number of days to delay update for, in your case). So I suggest to make three options instead: "Install now", "Remind tomorrow" and "Remind in a week" (you may test best values for delays, of course). The nice thing is that user will be able to choose between two periods quickly (one short period, but NOT too short, and another - long enough to go deeper in her tasks without any distraction).
Although, scheduling update for the certain time is OK, I think it may be confusing. It seems like it's not a simple process, but instead a process which will take time, may require restarting of the app or even the system, so it's better to just let people choose the time reminder will pop up next time. I think it's easy to figure out and much more convenient.