I think it is likely having issues running the imaging tool.
First off, I would recommend using the LANDESK Provisioning tool instead. It is much easier to troubleshoot. OSD is antiquated and is going away. Provisioning provides a lot of flexibility as well.
This article may help: How to get started with Provisioning for Windows 7 in LANDESK® Management Suite 9.5
It's interesting that a LANDesk employee tell you that OSD is antiquated and going away. Well, since you likely have LD9.5 or 9.5sp1/sp2, OSD is still a supported feature within those versions. Simply contact LANDesk support, and get some assistance. The log file on the core is a good place to start troubleshooting. C:\Program Files (x86)\LANDesk\MangementSuite\ldmain\log and look for a job that looks something similar to: CJ-OSD-Capture_Windows7_64_IMG_3.3-0-06302014-120602.log (this was one of mine as an example). Sometimes the error code in there will clue the technician what to look for, other times not so much.
One thing that has bitten me over the years, is making sure the drives are mapped properly to H: and I: The concept is, if the tools and the image path are not mapped, it can't execute the image script.
Is the service account that you are using within the OSD script locked out?.
Put a ; at the end of the OSD script, on the last line of the script, to halt the reboot. such as this: ;REMEXEC29=ldrun reboot, timeout=2
this will keep it from rebooting, then you can within WinPE, do some troubleshooting.
You'll spend about 2 hours or so troubleshooting with LANDesk, but I bet you find it to be a really silly setting that caused it. Sometimes, you'll go line by line in the script until you find what is the problem.
Wow.. what a useless answer. Step one is LITTERALLY "Make a image using OSD". And then it links to the document he links above.
I have also followed these instructions line by line and they simply don't work. I actually know the problem he is having and know how to fix it. You have to edit the script manually and change the drive letters from I: and H: to anything else. For some reason LANDesk makes scripts that aren't functional. I really am not sure why. After you make those changes, then the imagew tool comes up, but it only creates a file that is 4,736KB and never takes an image. Doesn't matter what drive you select in the drop down, the same thing happens.
Would be nice if your documentation actually worked.
The first step in that document:
Step one: Create an image with OSD.
The instructions are circular and impossible to follow as the problem is, first off, creating the image in OSD. It is running the imaging tool with no problem. The issue is it creates a 4.7MB image file no matter what partition is selected.
Not sure if this helps but I used to use the ImageW to capture/deploy images. I use a 100MB System Partition as the 1st Partition on the drive, and then the 2nd Partition is my Windows Partition. I did this just in case we ever enable BitLocker. So, in order for my Capture script to work I had to select from the GUI ('Image type and path' screen), "Specify which partition is the System or C: Drive" = 2. I saved the OSD script after filling in all the other required information in the GUI. This is what my Capture script looks like after the [MACHINES] section.