MacBook – Want to Update iMovie, etc. on MacBook Pro

Based on your hard labor so far :) and that the problem is not the cable.....it is time to try the:

1) Restart the computer in Safe Mode with display attached (shut down and restart while holding down shift key).

The display will show up without distortion.

2) Change the display to desired preferences (dimensions and refresh rate).

3) Restart computer.

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Since you mentioned the messages during the download, lets consider following.

From Apple:

This could occur when a self-powered Thunderbolt device (other than a directly-connected Thunderbolt display) is connected to a Thunderbolt port while installing the update.

To resolve this issue:

Shutdown your computer.
Disconnect all Thunderbolt devices.
Wait 10 seconds.
If you are using a Mac mini with a Thunderbolt display, reconnect the Thunderbolt display directly to your computer via the Thunderbolt port. Do not connect other Thunderbolt devices at this time.
Restart your computer.
If the Thunderbolt Firmware Update 1.2 is offered, download and install it and restart your computer when asked. If the Thunderbolt Update is not offered, the update has installed correctly.
Reconnect all Thunderbolt devices.

So thank you to @GeorgeGarside for helping me understand where the problem would lie I was able to find an informative article on correcting the problem

1. Go to the Finder.
2. Hold down the Option key and click on the the Go menu.
3. Select Library.
4. Look for the Application Support folder. Open it.
5. Look for the Dock folder. Open it.
6. Locate files ending in ".db". Drag them into the Trash.
7. Go to the  menu and select Restart (or log out if preferred).
8. Click on the Restart button (or log out).

Source: http://www.imore.com/how-reset-launchpad-mavericks