So, I'm a litle confused by all the commentary here. However -
* Having auto-errata update set for a server, when an errata is pushed, *does* mean that that server will be scheduled to receive the errata, by taskomatic. There were some holes in that process, but they were addressed...some time ago, I don't know exactly which release.
* If you select Auto-Update for a server via the webUI, that server is automatically scheduled to receive any errata that are outstanding as of that moment. That behavior was fixed quite some time ago in hosted.
near as I can tell, at this point a server with auto-update set is in fact scheduled to receive any outstanding errata available for that server.
I'm going to close this as "CURRENTRELEASE"