I'm creating this thread so that information about the VATS bug is in one place. The VATS bug seems to revolve around the place called Nipton. There's a good chance that if you apply the patch and load a saved game, and you're in Nipton, you'll encounter crashes when using VATS. There's at least two workarounds that have worked for several people that I know of:

Workaround 1:
1) Clear your system cache to delete the patch.
2) Start Fallout and make sure you select NO when it asks you to update (stay signed out).
3) Load up a save, fast travel or walk to a different location (ex. Primm), and then create a fresh save.
4) Exit to the dashboard, sign in to Live, and start Fallout.
5) Download the update and load up the fresh save.
Thread: http://www.gamesas.com/index.php?/topic/1125764-update-released-yay/

Workaround 2:
1) Start Fallout and load the save you want to use.
2) Randomly switch guns, hip fire, switch guns again, and hip fire.
3) That's all you should have to do.
Thread: http://www.gamesas.com/index.php?/topic/1125797-update-causes-repeatable-vats-crash/

Please post which one of these worked for you. If you still can't get around the bug, please post the location that you saved from when you applied the patch. It may not be only Nipton. It may not even be the location causing the problem, but the location is always Nipton so far from what I've seen.

Helped:
http://www.gamespot.com/xbox360/rpg/falloutnewvegas/show_msgs.php?topic_id=m-1-56853374&pid=959557

• My last save was in Nipton before installing the patch.
  
• VATS and fast travel both result in an instantly frozen screen.
  
  
• Workaround 2 does NOT resolve the issue.
  
  
• I also experience random freezes when traveling as the game refreshes the textures after a certain distance, but it is in specific locations like approaching Mojave Outpost from the road.
  
  
• I will try workaround 1 and post results.
  
  
• I have checked with several friends and it appears to have only affected 3 people that I asked. (less than half) Each of them were around Nipton, Mojave Outpost or Novac. ALL have a xbox slim (coincidence probably).

I had to reload my save game from several hours earlier VATS works but still have not been to Nipton. I have the old 360 and I saved in Nipton last night and applied the update this morning and NO VATS in Nipton. I also walked for like a hour and fast traveled a bunch as well as tried the second fix option. It didn't work. I am so tired of this... First I had to start over because the people in Primm kept attacking me... (maybe that was part of the wild wasteland perk) Now this.... Really????

I have an older Elite and I have the same problem. Last night I saved in Nipton, and downloaded the patch today and now VATS instantly freezes my whole system. I haven't tried to fast travel yet.

Workaround 1 works!

#1 worked!

People shouldn't have to use workarounds...QA testing should find these bugs first.

I was having this issue as well. method 2 didn't help but method 1 worked great. I am using an xbox elite.

That is exactly what is happening to me. Whenever I start to go from Nipton down the mojave outpost my xbox freezes, or if I use VATS.

haha that svcks if you can't fast travel. Wasting so much time going from one place to another lol. Good thing fast travel works for me, it's just VATS that doesn't work.

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The first method did work for about 2 hours. I was stuck in Nipton like many people. Afterwards I managed to play through, able to use VATS- It did crash finally though in the rocket factory by Novac... anypne else get a crash there after finishing that mission?

Bethesda you made me waste a sick call to work!

I've had the same Problems, i will go try both methods out and see if that will fix anything.

Edit: I've tried Method #1 and everything seems to be working now.... just hope it stays that way.

I was in Nipton as well when I downloaded the patch. Tried the second workaround first, since I figured it would be the easiest. It did not work for me. Issues persisted. Went through the first workaround and it got me out of Nipton, no more VATS freeze bug, but after about another hour of play I went to exit a building and the game froze at a black screen, had to turn off the 360. This happened several times while I was in Novac. Contemplating trying a new game and see where that gets me, otherwise I'll wait for another patch.