Can you test downloading servers.def from here: http://files.avast.com/iavs4x/servers.def
Save it to C:\Program Files\Alwil Software\Avast4\setup folder (overwriting the file there).
Start the update again.
But I’m not sure this is the (only) problem. Your log seems ok.
Are you using avast Home and seems to be registered it correctly. Am I right?