[QUOTE=Excalibre]
Has any of this stuff ever been spotted in the wild? Anything involving the JPG buffer overrun?
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Yes, actually. I used to collect computer viruses, and I have a captured copy of an in-the-wild JPG exploit around here somewhere. It was spammed to USENET a couple times, about a month after the vulnerability was announced, and continues (in various forms) to resurface now and then, the same way you see a few Blaster and Sasser outbreaks every few months. I saw one infected machine personally, back when I was fixing computers for people around the dorms, but it was a secondary infection; whoever wrote that thing was smart. It’s not obvious if you’ve been infected.
Interestingly, because those libraries are often licensed and used by other companies, which stash their own copies of them in different places on your hard drive, Windows Update doesn’t always make you safe. It’s admittedly an extremely small but not totally negligible risk, kind of like eating fugu (twenty thousand tons consumed per year, fifty to a hundred casualties… it’s slightly riskier than driving to work). Virus writers are damnedly clever people.
Fortunately, I guess, virus writers are also fairly practical people. For at least the past few years, it’s been fashionable to make viruses (worms and trojans, too, but I’ll call them all viruses for now) that make botnets. They’re not interested in your data, because they can make more money, more reliably, by using your computer to blackmail companies with the threat of DDOS, and, as you said, infecting files and hoping they get passed around is pretty inefficient. Once again, it’s a small but not totally negligible risk, perfectly acceptable for most, but not if you’re working on something where security is a neurotic concern, like a bank or a project that needs a security clearance, unless your home computer is also secured appropriately.
Mangetout’s threat assessment is pretty good. You’re probably more a danger to yourself than the virus writers are.