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#1
What are you using to try to update? 17112 is an Insider build, not general public. You specs say you are running 14390, which is 2, about to be 3 versions old.
I haven't run into this screen for a while, but it looks like you are trying to update to a version that is not compatible with what you are running. Like downgrading to an earlier, or x64 to x86 or vice versa, something along those lines.
There's only one MS official way you could have gotten 17112, and that is to be part of the Insider Program.
What are you using to try to install 17112?
The RTM build of 1607 was 14393 so either that's a typo, or its an Insider build from shortly before 1607's public release: Announcing Windows 10 Insider Preview Build 14390 for PC and Mobile
In general (for RTM or Insider builds) the greyed out 'Keep...' options indicate you are trying to upgrade to a different edition or language than the one currently installed.