Washington DC Endpoint Management User Group

I had created a site server to just offload Monitoring and Task services off the NS to reduce the load on the NS. This worked great till we tried to deploy a update our client image and run the sysprep job. It turns out the Deployment Service wont install on a site server unless package server is installed. What a pain!

Now I have to waist storage to house the packages on this site server even though the NS and Site server are in the same site! PITA!

Correct, you must have both task and package services installed on a site server in order to run the Deployment Task Handlers.  In 7.5, these are decoupled, so you can have a PXE server that only functions as PXE -- package can be obtained elsewhere.