I've been tearing my hair out while googling like crazy and reading the mailing list archives on this. There have been a few related bugs, I tried the fixes they proposed, and still the same error: "pkg: image-update cannot be done on live image".
This is an install from the 2009.06 OpenSolaris Live CD. I've been using it for about a week when I finally wanted to do an image-update to 127. $ pkg publisher PUBLISHER TYPE STATUS URI opensolaris.org (preferred) origin online http://pkg.opensolaris.org/dev/ blastwave origin online http://blastwave.network.com:10000/ contrib origin online http://pkg.opensolaris.org/contrib/ extra origin online https://pkg.sun.com/opensolaris/extra/ ha-cluster origin online https://pkg.sun.com/opensolaris/ha-cluster/ sunfreeware origin online http://pkg.sunfreeware.com:9000/ $ pfexec pkg install SUNWipkg No updates available for this image. $ zoneadm list -v ID NAME STATUS PATH BRAND IP 0 global running / native shared $ beadm list BE Active Mountpoint Space Policy Created -- ------ ---------- ----- ------ ------- opensolaris - - 27.18M static 2009-11-08 01:14 opensolaris-1 - - 817.5K static 2009-11-09 00:38 opensolaris-2 - - 2.98M static 2009-11-09 01:51 opensolaris-3 NR / 8.33G static 2009-11-22 19:43 $ pfexec pkg refresh --full; pfexec pkg image-update -v ... DOWNLOAD PKGS FILES XFER (MB) Completed 728/728 47986/47986 1037.93/1037.93 pkg: image-update cannot be done on live image $ beadm list BE Active Mountpoint Space Policy Created -- ------ ---------- ----- ------ ------- opensolaris - - 27.18M static 2009-11-08 01:14 opensolaris-1 - - 817.5K static 2009-11-09 00:38 opensolaris-2 - - 2.98M static 2009-11-09 01:51 opensolaris-3 NR / 8.33G static 2009-11-22 19:43 opensolaris-4 - /tmp/tmpckSxt6 42.0K static 2009-11-22 20:55 $ pfexec pkg -R /tmp/tmpckSxt6 refresh --full pkg: No image rooted at '/tmp/tmpckSxt6' $ pfexec beadm create testbe $ pfexec beadm mount testbe /mnt $ pfexec pkg -R /mnt refresh --full pkg: No image rooted at '/mnt' $ pfexec beadm unmount opensolaris-4 $ pfexec beadm unmount testbe $ pfexec beadm activate opensolaris-4 $ pfexec reboot ... (reboots into opensolaris-4 just fine) ... $ pfexec pkg refresh --full; pfexec image-update -v ... DOWNLOAD PKGS FILES XFER (MB) Completed 728/728 47986/47986 1037.93/1037.93 pkg: image-update cannot be done on live image $ pfexec svcadm disable svc:/system/filesystem/zfs/auto-snapshot:frequent $ pfexec svcadm disable svc:/system/filesystem/zfs/auto-snapshot:hourly (and daily, weekly, monthly, etc.) -- Same error message. Any help would be appreciated! Matt