Greg,
MDT or SCCM OSD is a scripted install approach for deploying a Windows OS. Usually used by PXE booting a physical or virtual machine, selecting the appropriate image/sequence and letting the machine build.
Having these builds deploy to templates to keep the templates current is a widely used process, however not generally automated. It usually involves someone powering on the template in question, PXE booting and building the new version, then snapshotting or shutting down and converting to template, depending on the VM deployment technology being used. This works great for templates because it guarantees a clean build.
Using this method for a cloud deployment methodology, such as a private cloud for dev/test using vCD is IMHO not the best approach. You will severely slow down your VM deployments, they will be somewhat manual as you will need to select the image, remove any thin-provisioning benefits of linked clones or even thin-provisioned disks, and exponentially increase your storage and network IO.
You would be better off updating your templates on a programmed basis using the above method, saving them into the catalogue so that any new deployments use the templates.
I hope that helps
Phil
