XP SP2 Implementation via GPO

Hi All,
I am trying to implement SP2 on our XP machines via GPO. I have checked twice and everything looks good but on reboot the machines I have added to the group blow past the the install straight to the logon screen. I know I have the Always wait for the network at computer startup and logon set to enabled in the GPO’s Computer Configuration\Administrative\Templates\System\Logon object but it still blows right past it to the logon screen. I can tell because I see the dialog boxes for applying the securty setting and SP2 install just before the logong dialog.

Anyone run into this? WHat did you do to slove it? Will the security seeting in the GPO apply if I have to use auto update?

Thanks.