I have SBS 2011 Essentials RC and i noticed there is no WSUS for clients. What is the proper way to insert the wsus into a group policy. Or will each client download the updates on their own?
Microsoft's web site still seems to be pretty short on details about the Windows Small Business Server 2011 product (being relatively new and still in Release Candidate status). It's not clear to me that WSUS gets loaded by default.
Assuming WSUS isn't installed by default it looks like you should be able to install WSUS 3.0 SP2 (the same version used by Windows SBS 2011 Standard) and configure it yourself. You should be able to use the variety of WSUS resources out there (I like the , personally) and documentation from Microsoft to build your knowledge about using the product.
As far as directing clients to the WSUS server goes you're talking about creating one or more GPOs containing settings to let the clients know where the WSUS server is and how you'd like them to download updates. I typically create a GPO linked at the top level of the domain that contains the "Specify intranet Microsoft update service location" setting (located under Computer Configuration / Administrative Templates / Windows Components / Windows Update) with the WSUS server name and TCP port specified (typically http://server-name:8530, assuming you allowed WSUS to create its own web site on the default port during installation).
I'll then create one or more GPOs linked at lower OUs to set the specific update policy for clients, member servers, domain controllers, etc. These GPOs will have the "Configure Automated Updates" policy set with settings appropriate for the type of computer ("Automatically download updates and install them on the schedule specified below " for normal client computers, "Download the updates automatically and notify when they are ready to be installed" for servers, etc).
Once you've created and linked the GPOs it's a matter of performing a policy refresh on a client and verifying, typically using the Resultant Set of Policy tool (rsop.msc), that the client has "picked up" the right settings.