So, we have one AD site boundary and one IP address boundary. They do overlap, and both have their own protected DP. But I believe that the DP protected by the IP address boundary will be used first (according the the MS article) in the list which is what we want. However, the PSP is located in the other AD site boundary. Question is, will it find that PSP in the other boundary, contact it, boot, but then use the distribution point in the local IP range boundary for the package content? This is what we need to accomplish here.

The boudnary has nothing to do with locating the PSP. That's done via IPhelpers on the router (preferably) or DHCP options. Sounds to me like you need to fix those boundaries, but that's not what you asked so I won't get into that. John Marcum | http://myitforum.com/cs2/blogs/jmarcum/|

Correct. PXE service location has nothing to do with ConfigMgr and is completely independant of ConfigMgr boundries. IP Address ranges are the only boundary types that are unambiguous and work as expected. They do increase your workload slightly but prevent much teeth gnashing, hair pulling, and idle threats.Jason | http://blog.configmgrftw.com

ok that is good, you are saying that as long as I have the IP Helper on the switch, regardless of boundaries I should find the PSP? also, we originally setup the boundaries as AD site, how should I fix this if I don't want overlapping boundaries in the same site? I can leave it as long as it will use the IP one first, what will it do?

Correct. PXE service location has nothing to do with ConfigMgr and is completely independant of ConfigMgr boundries. IP Address ranges are the only boundary types that are unambiguous and work as expected. They do increase your workload slightly but prevent much teeth gnashing, hair pulling, and idle threats.Jason | http://blog.configmgrftw.com