I just finished a deployment of SP2 to 1700 SP1 machines. Currently, we don't have any real problems with SP2. Of the major issues I had to face, spyware was the worst. only 2 machines of the 1700 failed at install and they were all recovered and manually upgraded after a Pest scan and AV scan.
Any slowness that has been seen is corrected by removing the XP GUI features that so many people seem to like. If you use the performance settings at Best appearance, then it's going to suck more power. If you use them at best performance, then it runs smoother. Also, instead of using MS's firewall, use a hardware frewall. Running Software firewalls on your machine will slow it down. Get a clean running AV engine. NOT any BIG consumer brand. Too much overhead; Norton/mcafee are the worst. Reudce the number of running processes, and increase your memory. Poeple think that running XPsp2 on 256 is fine. BS! get 512 or 1gb. XP uses more memory than any other OS, so give it what it needs.
The last problem was Drivers. Make sure you are up to date with the latest and most stable drivers for your hardware. Windows is very picky with it's drivers, and if they don't work right, your system won't either.
My 2 cents...