Code:
#
# Update product data
#
db_query("update $sql_tbl[products] set product='$product', categoryid='$categoryid', categoryid1='$categoryid1', categoryid2='$categoryid2', categoryid3='$categoryid3', brand='$brand', model='$model', descr='$descr', fulldescr='$fulldescr', avail='$avail', list_price='$list_price', weight='$weight', productcode='$productcode', forsale='$forsale', distribution='$distribution', free_shipping='$free_shipping', shipping_freight='$shipping_freight', discount_avail='$discount_avail', min_amount='$min_amount', param00='$param00', param01='$param01', param02='$param02', param03='$param03', param04='$param04', param05='$param05', param06='$param06', param07='$param07', param08='$param08', param09='$param09', low_avail_limit='$low_avail_limit',
free_tax' $apply_canadian_taxes discontinued='$discontinued' where productid='$productid' ");
See how I moved the discontinued= infront of the where. See if this helps.