TS worked with Win 7 image, but not with Win 7 SP1 image

I had reference image based on a Win 7 install and I recently updated it to use a Win 7 ISO that has SP1 built in.  In the previous image, I installed SP1 as part of the task sequence.  I had a couple of task sequences that installed some software for me that worked on the old image (Win 7 installed, then SP1 installed later), but now do not work on the new image (Win 7 w/ SP1 overlay ISO).
 
I've pushed each of the problem apps as advertisements to the deployed image after the OSD is done and they all work.  They just don't work as task sequence steps now.  They appear to timeout.  I'm not sure why.
 
Has anyone encountered something like this before? 

what do the logs say? advert. status or smsts? what are the exact errors? and where is the TS stopping?

I'm sure you aware of this patches but just to double check that you have installed the required updates and hotfixes on sccm.
 

• KB 2489044 – Update rollup for System Center Configuration Manager 2007 SP2 to add support for Windows Server 2008 R2 SP1 and Windows 7 SP1 clients
• KB 977203 – User state migration is unsuccessful on a SCCM 2007 SP1 client or on a SCCM 2007 SP2 client

 

I realize I didn't provide any details.  The problem was the task sequence was started at the end of the day, and it finishes, despite the software failures.  I do not have "Continute on error" enabled for any of the three tasks that are having trouble.  When the deploy finishes, I have no C:\_SMTS folder to thumb through. 
 
I will rerun tomorrow and jump in where the problems start and grab the log files.  I have it rigged so F8 will get me a command prompt so I can open notepad.
 
I have neither hot fix installed.  I'll read through the KB's and get those installed properly.
 
Thanks!
 

I have a question regarding hotfixes.  After chasing these hotfixes around, I find that I had installed hotfix 977384 ages ago, but it appears I haven't been doing it correctly on the client side.  There's a comment in jsandys' blog posting on "ConfigMgr Client Hotfix Versioning" (on this web site) that says 977384 is one of the hotfixes I can install during the build and capture phase, even though the SCCM client is re-installed during deployment. 
 
That doesn't make sense on the face of it.  Should I install this hotfix during the build and capture phase, or in the deployment phase, or both?  (using the PATCH= option in the "Setup Windows and ConfigMgr" task sequence step)