Glad you got it Sun.
This is a GREAT way to show the value in keeping images for backups. Once you get the newest service pack and all updates in place, an image kept for a backup will always allow you to wipe that thing, and start back right from the same point so you never have to worry about starting with the same service pack/browser issue.
I just did that a few weeks ago with someone who had XP and no backup images, and had to wipe it and start a fresh install. After doing what you did and manually downloading and installing SP2, it finally updated. Can you believe how many windows updates there were for that, lol ?!?!
Save an image, an you NEVER have to go through that again !!!!!
"Friends don't let friends dial-up"