There seems to be a little confusion about Microsoft Windows XP Service Pack 3.
We've been running the first release candidate of XP SP3 (RC1) since it was first made available, on a few test computers.
Microsoft, thankfully, is one of those companies that differentiates between beta software and release candidates (with release candidates being closer to "OK for you to mess with, but preferably not on a mission-critical or your main computer". Their beta software, as shown by the recent release of Internet Explorer 8 Beta 1, is literally for developers only (and likely will not be stable).
Back to SP3. We have had NO issues with the initial release (RC1). In fact, it has been stable on 3 boxes here. Microsoft has issued extensive documentation on this service pack / roll-up.
Mostly security, but, we are seeing what others have been reporting. A slight improvement in performance and stability. (This is not in the documentation so take it for what it's worth?).
Which brings us to the confusion.
There were a few builds of this service pack, the latest of which is Windows XP SP3 RC2. Note: RC1 users must offload the first version of SP3 before installing this newer build.
Microsoft advises that the latest version user experience shouldn't differ that much from SP3 RC1 ... which is exactly why we're downloading it right now :)
As always, we'll keep you posted :)