I can vouch for the fact that deployment through group policy does work, I've done all our PCs, worked OK.
Are you able to deploy other software using this method, i.e. is it just SP4 that's causing problems? Are you assigning it to the PCs, or publishing it? Can you run the Update.msi manually from the server location OK?
Have you used an absolute path when deploying the package in the GPO rather than a UNC path? eg. D:\Patches\update.msi is wrong, whereas \\SERVERNAME\Patches\update.msi is correct, assuming "Patches" is a shared folder of course
there r a few key points to know about here, as mentioned both methods work, however the advised method is using software deployment in group policy, this way you have several methods of selecting who actually recieves the policy.
1. In GPO software deployment ensure you ASSIGN the package under the COMPUTER configuration section.
2. Ensure you use UNC paths i.e. \\servername\sharename and not drive letters as drives are not normally mapped until u hit a logon script.
3. Ensure the COMPUTER account has permissions to access the share (a common mistake).
hope this helps, it's a pretty basic operation but one that easily confuses due to the amount of background security settings.
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