Exchange MVP William Lefkovics wrote in the November 29, 2007 EMO about Exchange Server 2007 Service Pack 1 and many of the changes included in the service pack. You can read that article in the EMO archives

One of the additional changes for administrators is that service pack 1 has been slipstreamed into the base release. That means that the service pack 1 installer includes the base release and it is not necessary to maintain separate installation media for the service pack and for the RTM release. This is new for Exchange Server and will help to simplify the deployment and update options for Exchange Server.

Note: RTM stands for Release To Manufacturing. The RTM release is the first release of a major version update to a product before any service packs are applied, such as: Exchange 2000 Server, Exchange Server 2003, and Exchange Server 2007.

In the past, when deploying a new Exchange Server, it was necessary to first install the RTM version of Exchange on the server and then install the latest service pack. (And, there were some rare situations where you actually needed to install every service pack in increasing order.)

Now, only the service pack archive itself is needed in order to install an Exchange Server. (Plus a language pack for the non-English versions.) This can result in a significant administrative savings when rolling out a new and/or updated Exchange environment (for example, an organization may choose to update all its Exchange Servers to Windows Server 2008).

When installing Exchange Server 2007 service pack 1, there is a specific order in which the service pack should be installed into the Exchange environment. This order is similar to guidelines that existed for earlier versions of Exchange (update all of your front-end servers first, then update all of your back-end servers, etc.).

Each of your CAS (Client Access Servers) should be updated first, then update all of your Edge Servers, followed by updating all of your Hub Transport Servers, and finally complete the update by installing the service pack on each of your Mailbox Servers.

If you have mailbox servers clustered via CCR (Cluster Continuous Replication), then the update process for each mailbox server cluster is as follows: update the passive node, failover to the passive node, update the former active node, and finally failback to the original active node. In this particular case, you do not do failover using ClusterAdmin, but rather by using the Move-ClusteredMailboxServer PowerShell cmdlet (see http://technet.microsoft.com/en-us/library/bb124710.aspx  for more information on using that cmdlet and see http://go.microsoft.com/fwlink/?LinkId=103632  for more information about the CCR update process).

The update process is overall much simpler than it was in past versions of Exchange Server.
Along with the items we’ve already discussed, Service Pack 1 also has speed improvements, reduced memory usage, database performance enhancements, feature parity with OWA in Exchange Server 2003, support for Windows Server 2008, better public folder support, support for importing and exporting mailboxes, plus many other improvements.

It is practically a truism that “service pack 1” is what the original release of a piece of Microsoft software “should have been.” I believe that that has never been more true than it is with Exchange Server 2007 service pack 1. If you have not yet begun to evaluate Exchange Server 2007, now is the time. With service pack 1, there are compelling reasons to begin to investigate and test the upgrade process.