Setting up WSUS on server 2008 and enable GPO's for client machines

I. Setup WSUS on server 2008. Follow the wizard. The best pratice is to set WSUS to update from the Microsoft web site, NOT download files to the server locally. This will help save space on the disk. Once the wizard is complete, run the first syncronization. During syncronization you can create computer groups.
    WSUS Console -> Computers -> All Computers (right click - create new group)

II. Create GPO's to link the client machines to WSUS, never put the computer to sleep and specify which computer group they should belong to.

Set the computer to automaticall update from the WSUS server and report the WSUS Console:
Computer Configuration -> Administrative Templates -> Windows Components -> Windows Update 
    Enable/Configure the properties of the following:
        1. Configure Automatic Updates - Set clients to search for udpates daily at specified time (usually late at night)
        2. Specify intranet Microsoft update service location - set both the intranet update service for detecting updates and statistics server to http://servername
        3. Enable client-side targeting - Specify which computer group you would like the computer to be placed into WSUS Console*

Set the computer to never go to sleep so automatic updates can be downloaded and installed:
Computer Configuration -> Administrative Templates -> System -> Power Management -> Hard Disk Settings
    Enable/Configure the properties of the following:
        1. Turn Off the Hard Disk (Plugged In) - Set to zero 
        2. Turn Off the Hard Disk (On Battery) - Set to zero

*Create computers groups in the WSUS Console before setting up GPO

The client computers usually require a reboot before reporting back to the WSUS server.