I just found that it's not mapping to share where the image is located. The MapToPreferredHandler.log says:
"lddwnld.dll version is too old or missing. Aborting download."
I'll report back when I find how to fix this file.
Have you upgraded your pxe rep after updating to SP1?
Do not map to the drive if you are storing the image on your core. Make the core a preferred server and enter real credentials. We will use those credentials to access the share. If you map to the core and and it is a preferred server at the same time then it can cause issues.
I did not redeploy my PXE. That did the trick!