Yes, it works quite well - both for making CD distributions or a network distribution point. Copy the contents of your Windows 2000 CD to a folder, we'll call it WIN2KCD and locate it at the root of the C: drive for the purposes of this answer. From either a command prompt or the Run command, run the Service Pack Update program using the following syntax:
update.exe -s:C:\WIN2KCD
This will integrate the Service Pack installation into the standard O/S installation files, so that when you install from the WIN2KCD\I386 folder Service Pack 1 will be installed also.
NOTE 1: You can not uninstall the Service Pack if it has been installed from an integrated distribution.
NOTE 2: When you create a CD from the WIN2KCD folder, it willnot be bootable like the original Microsoft CD. Most CD creation software will allow you to create a bootable CD using a boot floppy, like the Windows 98 Startup Disk. If you do this, make sure to modify the startup environment to include advancedmanagement tools like HIMEM and SMARTDRV to help speed the initial install process.
Hope this helps, -Ewing