A couple of things.
First, there is no product called SCCM 2016. Instead, it is called CMCB then the build #, the latest version is CMCB 1806.
The CMCB forums can be found here. https://social.technet.microsoft.com/Forums/en-US/home?category=ConfigMgrCB
For CMCB, it is not supported to deploy SU within WSUS directly, odd things will happen if you try to do this. In a nutshell, you shouldn't be setting more WSUS GPO setting CMCB will take care of that. Your GPO setting might be your problem. CMCB
should take care of everything with respect to WSUS.
Garth Jones
Blog: https://www.enhansoft.com/blog
Old Blog: https://sccmug.ca/
Twitter: @GarthMJ Book:
System Center Configuration Manager Reporting Unleashed