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I have had the same results. I switched to Windows 7 PXE rep to get it to work. I have filed a ticket with LANDesk for Windows 8.1 PXE Rep.
I have a Server 2012R2 VM as a PXE rep and preferred server and it's working as expected in our dev LD9.6 SP1 environment.
I didn't do anything special to get it to work.
You do need an up-to-date 9.6SP1 agent on the representative to make the PXE Deployment work succesfully.