I believe SP3 won't install on an already running install of XP unless it has at least SP1, but will slipstream onto an install disc with or without any service packs.
So I am pretty sure SP3 has all the updates that SP2 has
though I slipstreamed onto a disc that already had SP2 anyway.
SP3 was only 316MB for me...
Anyway, I slipstreamed it without using nlite.
just use the "[SP3 exe name].exe /integrate:[folder path of XP disc files]" command