According to Microsoft support

If SP2 is installed on a system that is compromised by spyware, adware, or known or unknown viruses at the time of install, the system will more than likely experience random lockups, possible system crashes and general instability. It may cause problems due to permission levels and Windows Activation on XP Home versions that require product activation. It has also been documented that any programs installed AFTER SP2 has been installed may suffer the same instabilities