If (as presumably you do) you have .NET framework v 1.1 installed, the SP1 update fixes several security issues, and I would install it (gave no problems here).

For general info about what .NET framework is

see

http://www.microsoft.com/net/basics/

http://msdn.microsoft.com/netframework/

or if you google you'll find lots more info

http://msdn.microsoft.com/netframework/technologyinfo/howtoget/default.aspx

click on the link 'check to see if you havfe .NET framework 1.1 installed'. Or just see if you have a folder C:\WINDOWS\Microsoft.NET\Framework with subfolders such as v1.1.4322 with files in it. In any case if you attempt to install the update and you don't have .NET frramework 1.1 installed, the update will not install, it will tell you it is not compatible with what you've got.