Would avast prevent threats from exploiting the latest security flaw in Windows? I understand it only affects users of Internet Explorer. At the moment avast is working well with IE8 on my pc, including the sandbox feature. Does avast work fully with the other main browsers or are there known issues with Chrome, Firefox or Opera?
Since you are using it sandboxed, you should be safe. But there is a fixit solution for the bug. Check this page : http://support.microsoft.com/kb/2501696 Download both the fixits - 50602 & 50603. Close all applications that might be using ie and install 50602. In case you had problems with the fixit, use 50603 to remove the fix.
But, again, as I said, you should be safe as you are using ie sandboxed.