The Run8 Updater App must be in the same location as V3's exe, typically:

c:\Run8Studios\Run8 Train Simulator V3

Also, the computer must be internet-connected at the time of updating. It's also possible you have an antivirus\firewall program that is blocking the Updater App from running, and if so, you'll need to set an Exclusion\Unblock it in that program's Settings.