Did you get any direction on this issue? Can you clarify the authenticate comment? My view is that the users login credentials are enough. For us, they can access the share directly or DFS. With DFS they the whitelist is ignored, forcing the user to have the install password typed for them. (I do realize the long span of when you opened this vs now)
Here is an excerpt from the LDMS manual. It will explain what needs to be done on the client to have DFS work properly. The accounts you want to make sure your DFS has is the Domain Computers Account and the account you have for the scheduler service in teh services. I add Authenticated users as well.
Using software distribution with packages on a distributed file system (DFS)
Distributed file systems (DFS) use several servers to provide files that are available from a single file share. Software distribution's default method of bandwidth detection in a DFS scenario ends up using the root server to calculate bandwidth, which may not be the actual server that provides the file. Software distribution now provides an optional way of calculating bandwidth. With this new method, bandwidth detection retrieves a small portion of the actual file being distributed. This way, software distribution calculates bandwidth from the server providing the file.
This alternate bandwidth detection method isn't enabled by default. You can enable this option from the ntstacfg.in# file in the core server's ldlogon folder. Once you update this file, the changes become part of new or updated agent configurations. You must redeploy your agent configuration to devices for the change to take effect.
Look for this section in ntstacfg.in# and make the necessary changes.
; The following registry values control detecting bandwidth by file download
; change the UseDownloadForBandwidth value to 1 to enable use of file download for bandwidth detection
; the DownloadSize value should be entered as a Hex value between 400 and FFFF(1024 bytes to 65535 bytes).
REG1=HKEY_LOCAL_MACHINE, SOFTWARE\LANDesk\ManagementSuite\WinClient\SoftwareDistribution\UseDownloadForBandwidth, 0, , REG_DWORD
REG2=HKEY_LOCAL_MACHINE, SOFTWARE\LANDesk\ManagementSuite\WinClient\SoftwareDistribution\DownloadSize, 2000, , REG_DWORD