Tick the box at the very bottom: "Deploy this image from the PXE enabled Distribution Point".
Note, PXE happens well before the boot WIM loads; what you see when PXE booting is the machine firmware (BIOS or UEFI) talking to WDS that has the PXE boot option set (thanks to you ticking the box). At that point you see the white progress bar and life is good.
I am trying to run an OSD to a bare metal to a new Dell Latitude 7370 using a PXE boot via USB docking station.
I successful boot to Win PE, but U get an error "This computer is not registered with System Center Configuration Manager 2012 R2" This is the first Latitude 7370 I am trying.
Do you think my older SCCM 2007 machine could be throwing this for a loop. It just points to WDS which in turn points to boot files. A certain Mr Nystrom gives full detail here: https://deploymentbunny.com/2016/02/29/osd-how-make-pxe-work-in-configmgr-osd-mdt-and-wds-work-perfectly-fine-stop-using-dhcp-option-66-67/ Removing the DP is a last resort only, once you have eliminated all other sources of conflict.
On my new SCCM 2012 there is only on DP and only the Primary site.. Note you always need both architectures, x86 and x64 boot files regardless of what OS you are building. As I said, the DP is set correctly so I'm suspecting something else is pointing machines to the wrong place.