Re: SP3 install System Hang
Hello Utanka, it is not just like you received the SP3 update, confirmed to install and the installation will be completed. There are few things you need to do before installing the same. You can get the complete stuffs that you need to do in this Microsoft KB: "Steps to take before you install Windows XP Service Pack 3"
Re: SP3 install System Hang
First of all you should never install Service Packs from Updates but instead download their ISO files from Microsoft Download Center, and then install them. Always remember to install Service Pack 3 in 'Clean Boot' mode. To know how to boot XP in clean boot mode, check this URL: http://support.microsoft.com/kb/310353
Also check How to optimize your chances of installing Windows XP SP3 successfully:
http://www.pagestart.com/windowsxpsp3p3pg8.html