I slipstreamed SPI FINAL (yes that's final, not beta) into my copies of Home and Pro retail, and Pro Corporate and they all accept keys generated by the bluelist Keygen AND Windows Update still supplies me with updates when they become available.

For those who say SP1 will kill Winupdate if you're using an illegal serial number - WHO CARES?! Off the top of my head I can think of several sites that have these updates available for download, so there's no need to to venture directly into the Lion's den to get any new updates that become available. We all know these files become hot gossip and readily available on sites like these the very moment they're released, so why stress about Winupdate not working?!

Because people are stupid. Besides as you semi-kinda pointed out all these patches can be downloaded from microsoft without needing windowsupdate. All windowsupdate does is detect some patches missing, as it is it does so horribly anyway. Absolutely no loss by windowsupdate not working.
If you want patch detection try http://updates.cnet.com

The Windowsupdate.com is still V4. Wait unti V5 comes out, and you will see.

The windows corporate update site dosn't check anything and lets you grab all the patches to save locally, not bad to burn to cd if you dont want to download them every reinstall.

If you install Windows XP clean and apply SP1 you will not have anything to download from Windows Update yet. Most of the patches are included in SP1 with the exception of the 'extras' such as the .NET framework.

Is it, perhaps, possible that future Critical Updates will be locked in the process of scanning/retrieval if your copy of Windows XP is not properly acknowledged by WU?

I disagree with the use of pirated Windows installations but I also disagree with Microsoft's attempt to thwart this behavior by making life for the paying users more difficult. One can only assume that these new attempts to keep fixes away from pirates will somehow, somewhere down the line, foul up something for a legitimate user.