Wake on LAN is a new feature of SCCM that was not present in SMS. You can use it to wake offline (standby/hibernate/shutdown) computers to install updates, software packages or task sequences (e.g. OS).
To use WOL remember to run through some of these steps:
1. Check if you can at all wake the target workstation. You can use this tool: http://www.matcode.com/wol.htm to run a check.
2. Make sure computers/routers supports WOL: http://technet.microsoft.com/en-us/library/bb680822.aspx
3. Verify HW inventory ran at least once on the computer before you use WOL.
4. Check WOL logs: WOLMgr.log, WOLCMgr.log for WOL activity once you advertise a WOL-enabled package/update/task sequence.
5. Monitor WOL activity – see if any packets are sent (perf counters), if computers are targeted by WOL (report). See: http://technet.microsoft.com/en-us/library/bb693671.aspx
The downside of WOL is security - there is not much authorization process prior to WOL. But SCCM SP1 will have integration with Intel’s Active Management Technology (AMT) to provide more secure method of computer wake-up. AFAIK SCCM SP1 is expected Q2 2008.
For SMS 2003 you can still use Intel's AMT add-on: http://www.microsoft.com/smserver/partners/intelamt.mspx.
[update]: here is a known bug regarding WOL which you may encounter in some regions:
The "wake on LAN" feature does not work as expected if a site server uses a non-daylight saving time zone in System Center Configuration Manager 2007