Thanks for all your suggestions and feedback, updating status to completed.

SCCM 1902 fast Ring released today
Blog: https://techcommunity.microsoft.com/t5/Configuration-Manager-Blog/Update-1902-for-Configuration-Manager-current-branch-is-now/ba-p/376516
Docs: https://docs.microsoft.com/sccm/core/plan-design/changes/whats-new-in-version-1902

Updates added to the previous response, these documents are the first iteration and we’ll continue to add and improve.
We’d ask if you encounter issues with the Install Updates step to file a bug or engage support so we have logs etc. to work with to help diagnose and solve your issues. Also, if there’s specific asks for additions to the feature or documentation please open additional User Voice items.

Today we published a new article and related flowchart to provide some insight and guidance for using the Install Software Updates task sequence step.

Announcement
https://twitter.com/AaronCzechowski/status/1102647530339221504

Link to document:
https://docs.microsoft.com/en-us/sccm/osd/understand/install-software-updates

Flowchart at full size
https://docs.microsoft.com/en-us/sccm/osd/understand/media/ts-step-install-software-updates.svg

- Flowcharts; the install updates proved popular. We’ve had asks for the same for Peer Cache, Task Sequence Pre-cache, Software Distribution Troubleshooting and more. These are all on User Voice too, also if you’ve suggestions for flowchart please open a User Voice item.

- Task Sequence Variable SMSTSWaitForSecondReboot. I’ve this in my notes to add, this variable helps with 2nd reboot and will be added to core docs. This also works with applications that cause a second reboot. See https://support.microsoft.com/en-us/help/2894518/ for more.

- Hardware guidance for capture. I’ve run some tests on various hardware, though seems from the comments below Dr. Michael Kischel’s guidance is working.

- Image Capture. Asks for scripts to address removing Appx and performing other customizations. If there’s more please add.

Previous code changes
Timeout scan is now configurable
We added a new task sequence variable to allow a configurable timeout for scan. Variable name is SMSTSSoftwareUpdateScanTimeout, default is 30 minutes. Value is set in seconds so an hour is 60×60=3600
Note: We took a further change after making this configurable to set the default to 60 minutes based on feedback and findings from support cases.

Logging changes
In the SMSTS.log we list the log files to check for updates download and evaluation.
These are UpdateDeployment.log, UpdatesHandler.log, WUAHandler.log and WindowsUpdate.log

New Option for full scan
There’s a new checkbox added to the Install Updates step – ‘Evaluate software updates from cached scan results’
If the checkbox is on we use cached results, if the checkbox is off we do a full scan
Task Sequences that are upgraded will have this option checked on – this is parity with the existing behavior

Power management changes
Clients maintain active power state during OS deployment Software Updates tasks.
Some devices (Surface Pro 3 for example) were going into Connected Standby state preventing completion of deployment, this was occurring in the Install Updates step

Windows upgrade roll ups
These are now filtered from the list of applicable updates

This features is included in #ConfigMgr 1710 release.

General Blog: https://cloudblogs.microsoft.com/enterprisemobility/?p=67486
Docs: https://docs.microsoft.com/en-us/sccm/core/plan-design/changes/whats-new-in-version-1710

The notes for the 1711 Tech Preview apply here too and we’ll continue to work on these

Console actions are fixed in many instances where we didn’t traverse the referenced packages/content
Export now exports child task sequence and referenced content – secrets are cleared from the referenced task sequences too
Task Sequence import now works and detects duplicates
Copy action copies parent and all reference to child task sequences
Delete action detects if there’s a parent child relationship and displays what’s affected
Similarly deleting packages that are in child task sequences is detected and shown in the delete package wizard
Initially we had limited to one level – now there’s no limit, but use that wisely
Related to the above, we do not permit a circular reference i.e. a parent cannot reference same parent, a parent cannot reference a child that references same parent – we traverse the entire chain
Create Prestage Content is updated to work for task sequences with multiple child references
Deployment Verification now detects when the child contains the ‘high-impact’ steps
Standalone media creation detects and adds all task sequence and content references and completes end-to-end

Things to note
We do not permit selecting a task sequence with a Boot Image reference, for any deployment that requires a boot image that reference has to be on the parent
Any chain containing a disabled task sequence will fail – the continue on error won’t work for that step
Criteria for popping the ‘high-impact’ warning are not detected in Software Center when the child contains the ‘high-impact’ steps, in this case our recommendation is to use the Task Sequence User Notification properties to force the ‘high-impact’ warning
If a child task sequence has a package reference removed the parent does not detect this. To workaround, make any edit to the parent (anything that activates Apply)

As always we appreciate any and all feedback, try it out and let us know what you think