Hi,
You can define the Transaction Isolation level at both the connection level and the statement/transaction level.
If I understand your scenario correctly, I would consider adjusting the Transaction Isolation level prior to your specific update query only, if the majority of the other activity within the given connection is going to be read only activity.
Keep in mind that the default isolation level for SQL Server is Read Committed, so if you set a different isolation level at the connection level then you will need to swith to Read Commited at the transaction/statement level prior to your update.
One thing to consider of course is to leave the default Isolation Level as is. Is there a specific reason why you feel that Read Committed is not appropriate for your generic read activity?
Make sense? Let me know if you need further clarification.
Cheers, John
Updated Based on comments.
Fair enough, if you are developing a high end OLTP database, you may want to look at a SQL Server technology/principle called row versioning. This will allow you to perform reads of a version of a record so to speak. There is overhead on the tempdb when using such techniques but if your are using sufficient hardware then it may be appropriate.
The following white paper is an excellent guide to SQL Server Row Versioning/Snapshot Isolation
http://msdn.microsoft.com/en-us/library/ms345124.aspx