Update Query No Longer Runs As Transaction.

Hi,
I have been using the following query, literally for years, without any changes. I run it from code using db.execute, and I do use the dbfailonerror option.

UPDATE TST3 SET [date] = Mid([timedate],8,2) & '/' & Mid([timedate],10,2) & '/' & Right([timedate],4), [time] = Left([timedate],2) & ':' & Mid([timedate],3,2) & ':' & Mid([timedate],5,2), Serial = [serial] & '3';

One of the things it does is to add a '3' to the end of the [serial]. [serial] is the primary key in the TST3 table. You might think that there would be a problem if, say, I have a list of serials containing
35
56
1
13
and I'm trying to update them to
353
563
13
133
But this has worked OK in the past. NOW I'm getting a KV Error when it tries to update the 1 to 13, because there's already a 13 in the table.

Even stranger, when the query fails, all the rows BEFORE the offending record DO get updated. So the query fails, and I end up with:
353
563
1
13
(and yes, I DO have dbfailonerror set)

So, it looks to me as if update queries are no longer running as transactions.
I am pretty certain that action queries have always been run transaction-wise in the past... if the query fails, the whole thing should fail. WHY is the transaction processing no longer working for this update query? Has anyone else noticed this?

I recently ran microsoft update and am now running
Access 2002 (10.6771.6830) SP3.