Have my XP Home updated to SP3 and not a single problem. In fact, I will go so far as to say that XP is now more stable than it was before updating to SP3. I was not a fan of XP, had a lot of problems with it, but the last several months, since updating to SP3, I am happy with XP.
When I updated to SP3, I followed the advice that I read on a number of forums....do the update manually, do not allow auto-update to attempt it. For some reason, allowing the Windows Auto Update to attempt to install SP3 will give horrible results. Manually go onto the Update site, manually select the SP3 update and install it. My install of SP3 went so smooth. My sister-in-law, who swears by auto everything, says that SP3 will not install on her system and won't believe me when I tell her that it is due to her allowing auto update to do it. I have installed the SP3 package on 4 computers, all done manually, and have had no problems.
Once you select the SP3 update manually, and hit the download button thingie, the install is automatic....you don't have to do anything. It will take a while to install the full update, but the wait is well worth while.
OBIO