In addition to the usual compilation of patches and hotfixes, this update to Windows Server 2003 includes some new features as noted on the Windows Server Weblog:

- Windows Deployment Services is an updated and redesigned version of Remote Installation Services (RIS), allowing administrators to set up new computers through a network-based installation without having to be physically present at each computer and without having to install directly from DVD media.
- Windows Server 2003 Scalable Networking Pack enables customers to cost-effectively improve the performance and scalability of network-based Windows Server 2003 workloads, such as file storage, backup, Web servers and media-streaming. The Scalable Networking Pack accomplishes this by providing support for networking technologies focused on eliminating operating system bottlenecks associated with network packet processing.
- Wi-Fi Protected Access 2 supports the new Wi-Fi Alliance certification for wireless security, making it easier for end users to securely connect to Wi-Fi hotspots.
- Improved IPsec Filter Management reduces the IPsec filter set that needs to be managed for a Server and Domain Isolation deployment from potentially hundreds of filters to as few as two.
- “Firewall per port” authentication secures traffic between extranet environments and internal assets that are protected via IPsec domain isolation.
- Microsoft Management Console 3.0 supports richer functionality in snap-in management tools, allows users to add or remove snap-ins and provides improved error handling via the MMC console.
- Enhanced MSConfig provides a single launching point for common support tools that will ease server diagnostics.
- Performance improvements under Windows virtualization and for SQL Server.

More information here: http://www.microsoft.com/technet/windowsserver/sp2/overview.mspx