I finally ran this last night and it worked great. Took about 1/2 hour to finish. It downloads everything first then goes back and installs.
I was browsing on the new WiiShop channel and picked up the new System Menu as well. Downloading from the new WiiShop channel supports downloading straight to SD card.
Who needs a hard drive anyway? 16GB SDHC card is $40 and will only go down.