Here are the steps for slipstreaming visual studio 2008 with service pack 1
Consider you have visual studio 2008 ISO file or DVD mounted on G: drive. If your drive letter is different then dont worry. I will get back to this in step 4.
You have enough space say in HDD in partition say D: of about 8GB.
Extract the visual studio 2008 service pack 1 to D:\VS\SP1 folder
Copy the below commands to a batch file and name it "integrate.bat" and place it in "D:\VS\" folder. If your DVD drive letter is different, then suitable modify the G: in the batch file with the corresponding drive letter.
::Extract the original visual studio 2008 installation to directory VS2k8WithSP1.
msiexec.exe /a "g:\vs_setup.msi" TARGETDIR="%CD%\VS2k8WithSP1"
::Copy some file to make slipstream integration successful.
copy "VS2k8WithSP1\Program Files\Microsoft Visual Studio 9.0\Common7\1033*.chm" "VS2k8WithSP1\Program Files\Microsoft Visual Studio 9.0\Common7\IDE\"
::Extract each .msp files to directory VS2k8WithSP1.
msiexec.exe /a "%cd%\VS2k8WithSP1\vs_setup.msi" /p "%cd%\SP1\vs90sp1\VS90sp1-KB945140-X86-ENU.msp"
msiexec.exe /a "%cd%\VS2k8WithSP1\vs_setup.msi" /p "%cd%\SP1\vs90sp1\VC90sp1-KB947888-x86-enu.msp"
msiexec.exe /a "%cd%\VS2k8WithSP1\vs_setup.msi" /p "%cd%\SP1\vs90sp1\VC90sp1-KB948484-x86_x64-enu.msp"
msiexec.exe /a "%cd%\VS2k8WithSP1\vs_setup.msi" /p "%cd%\SP1\vs90sp1\VC90sp1-KB948560-x86_IA64-enu.msp"
::Copy the product key file
copy "VS2k8WithSP1\Setup\Setup.sdb"
::Copy the setup bootstrapper files
copy "VS2k8WithSP1\Program Files\Microsoft Visual Studio 9.0\CSetupMM*.*" "VS2k8WithSP1\Setup"
::Copy VC runtime files
md VS2k8WithSP1\wcu\VCRuntimes
copy SP1\vs90sp1\vc_*runtime.exe VS2k8WithSP1\wcu\VCRuntimes
::copy SQL Server Database Publishing Wizard
copy SP1\vs90sp1\SqlPubWizInstaller.exe VS2k8WithSP1\wcu\SqlPub
::copy SQL Server 2008 Management Objects and SQL Server System CLR Types configuration.
md VS2k8WithSP1\wcu\SMO
copy SP1\vs90sp1\SharedManagementObjects.msi VS2k8WithSP1\wcu\SMO
copy SP1\vs90sp1\SQLSysClrTypes.msi VS2k8WithSP1\wcu\SMO
::copy SQL Server Compact 3.5 SP1 English with the Microsoft SQL Server Compact 3.5 SP1 Design Tools English.
copy /Y SP1\vs90sp1\SSCERuntime-enu.msi VS2k8WithSP1\wcu\SSCE
copy /Y SP1\vs90sp1\SSCEVSTools-enu.msi VS2k8WithSP1\wcu\SSCE
::Extract the dotnetfx35.exe manually to a %tmp% folder. Copy all files and subdirectories from %tmp%\wcu\dotnetframework to vs2k8WithSP1\wcu\dotnetframework and overwrite files
::Sorry I could not able to automate this step as /extract option is disabled in the dotnetfx35.exe file.
Go to command prompt and navigate to "D:\VS\".
With "D:\VS" as the current directory execute the integrate.bat batch file. This will take approximately 1hr. So relax and work in parallel with other stuff.
After the batch file executes completely, extract the dotnetfx35.exe manually to a "D:\VS\tmp folder". Copy and overwrite all files and subdirectories from "D:VS\tmp\wcu\dotnetframework" to "D:\VS\vs2k8WithSP1\wcu\dotnetframework"
Now you have successfully slipstreamed the visual studio 2008 with service pack1. Now D:\VS\VS2k8WithSP1 folder contains the slipstreamed copy of visual studio 2008. Now you can delete ISO files (if you have) and any other files or folders other than D:\VS\VS2k8WithSP1.