The "blocker" mechanism that temporarily disabled the delivery of Windows XP Service Pack 2 (SP2) through Windows Update and Automatic Updates has expired and is no longer available.
While Windows XP SP2 will be automatically downloaded if you have selected this option, it will not be automatically installed. Follow these steps to install or decline Windows XP SP2.
Once the download is complete, a message box will appear, saying “Updates are ready for your computer. Click here to install these updates.” Nothing will happen until you click on this box.
When you click on the box, the Automatic Updates dialog box appears and asks you if you want Express or Custom install. Click "Next" at this point to install Windows XP SP2.
If you do not want to install Windows XP SP2, click Custom, then uncheck (deselect) the reference to Windows XP SP2. A box will prompt: “Don’t show me this update again.” You must check (select) the option to not show the update again, and click OK. At this point, Windows XP SP2 will not be offered again.
It should be noted that not all machines (without Windows XP SP2 already installed) will see the SP2 download notification immediately. This will roll out on a gradual basis over about a week’s time.
In regards to Software Updates Services 1.0 SP1 (SUS) and Automatic Updates(AU), the expiration of the registry key does not affect the approval status of Windows XP SP2 on your SUS Server. If Windows XP SP2 was not approved, it was not automatically approved on April 12th on your SUS Server. Only if Automatic Updates is going to the public Windows Update website will the registry key no longer be honored.