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The tool system-config-packages available in FC2 is too limited and does not handle dependencies well. It also suffers from many usability issues, specially when reporting missing dependencies. Synaptic does a much better job in all aspects. All we need to have a better package management system in FC is bundle apt-rpm (just 1 rpm more to the whole distro), Synaptic (1 rpm more to the whole distro) and make the ISOs apt-enabled (just a few MB of extra space) so they can be used with apt-cdrom. This will make installing and unistalling rpms individually much easier and less error prone than it is today with the default tools. This has nothing to do with up2date or the applet that keeps the system on sync with the periodic updates, I'm asking for an enhancement to the tool used to change the installed packages.
Fedora Core 2 is now maintained by the Fedora Legacy project for security updates only. If this problem is a security issue, please reopen and reassign to the Fedora Legacy product. If it is not a security issue and hasn't been resolved in the current FC3 updates or in the FC4 test release, reopen and change the version to match.
Closing, since yum front ends seem the way to go now.