I'll let this post be a running list of issues that I hear about as people try installing SP1.  So far I've heard mostly good things about the installation process but a few problems as well.  Here's a few things to know:

1) If you get a Windows Update prompt to reboot during SP1 installation, ignore it (don't reboot).  Wait until after the SP1 installation completes and then reboot.

2) If you have a prerelease of the Team System for Database Development GDR (that supports SQL 2008) installed, you will need to uninstall and 2reinstall it after upgrading to SP1.

3) Apparently you can't create the admin mode/slipstream TFS installer when running on a Vista 64-bit OS.  I suspect it won't work on any 64-bit OS but the customer report I saw said it was 64-bit Vista but it worked on 32-bit Vista.  Of course TFS itself can only be installed on Windows 2003 or Windows 2008 and the application tier still only supports 32 bit.  Yes, I know, I know.  We've gotten tons of feedback about how bad it is not supporting 64-bit.  That's coming in our Rosario release.

4) We've had numerous reports of checkin notification failures when users user tfsadminutil configureconnections to configure a Team System Web Access Url.  We have confirmed that this is a bug and and working on a patch now.  Watch for it on Code Gallery here: http://code.msdn.microsoft.com/Project/ProjectDirectory.aspx?TagName=Hotfix%2ctfs.

Good luck and let me know what you learn so we can share it with others,

Brian