Bundle Mode means the router, switch, WLC boots the BIN file. Because the BIN file is the compact form of the firmware, the packages are extracted in the memory of the platform. This means the boot-up time is longer and utilizes more CPU and memory resources. It is NOT possible to install any SMU in Bundle Mode.
Install Mode means all the packages files are fully extracted and the switch goes through the list to boot the different packages in order. Because the package files are already extracted into the flash, the boot-up time is faster and uses less memory and CPU resources. Because the package files are fully extracted, the stack master is capable (if the commands are present or enabled) to push the firmware down to any stack member joining the stack with incorrect firmware version.
For obvious reasons, Cisco TAC recommends Install Mode and only use Bundle Mode in "extreme cases" such as booting a platform in ROMMON.
