Bravo to MS my ass.. SP2 default settings play havoc with lots of traditional coding techniques... I'm not surprised MS argued against setting some of these options as on by default so hard.
there is a great Check list here showing exactly what SP2 effects and how MS suggest "fixing" the issue on your website.
Fine-Tune Your Web Site for Windows XP Service Pack 2
Applies to:
Microsoft Active X controls
Microsoft Internet Explorer
Microsoft Outlook Express
Microsoft Windows XP Service Pack 2 (SP2)
Summary: Make your Web site work well with the new security features in Windows XP SP2 that affect ActiveX controls, file downloads, pop-up windows, and more. (7 printed pages)
Topics include:
Does Your Web Site Use Microsoft ActiveX Controls?
Does Your Web Site Allow Users to Download Files?
Does Your Web Site Use Pop-up Windows?
Does Your Web Site Depend on the Microsoft Java Virtual Machine (MSJVM)?
Browser Window Restrictions
General Tips