Here's what i did:
1) Installed Visual Studio 2008 SP1 first, as we have team explorer on the TFS server (useful for admin use). Remember for our relatively small setup we've put both the app tier and data tier on the same VM. SP1 install time 1hr 15mins (Oooh!). Reboot required.
2) then installed Team Foundation Server SP1. Install time 15 mins. No reboot needed but I did one anyway, just to see those services start up nice and cleanly :-)
If you do it in this order you should be assured of a pain free installation. Well OK then... at least a 'reduced risk' one anyway.
What do you gain by installing SP1?
Here's two useful links showing what you get with this upgrade:
- List of the 227 bug fixes in SP1. Also provides an interesting account of how the bugs were discovered.
- New features in SP1.
If I come across any issues I'll post them here.