Last year I blogged about this. I had difficulties getting this working so I fired a question to MS on the subject. For any MS person reading, the case number was case#SRX081210600013. The PSS engineer said this was not possible. I would have to continue the time and space consuming process of copying the ISO files over. That sucked.
I’d since read on one of the MS blogs that sharing an ISO or DVD image over the network from Virtual Machine Manager was actually possible. The required configuration was blogged by Jose Barreto. What you need to do is edit the properties of the AD computer account object of every Hyper-V server managed by VMM. Edit the delegation and configure constrained delegation. Add the names of the VMM library server(s) and add them with the CIFS (file sharing) protocol. To be save I did a reboot of the hosts (live migration rocks!).
I finally had an opportunity to deploy this configuration. I tested and I was then able to share an ISO over the network.
You’ll note that Jose didn’t actually do this for VMM. His example was where he was using the Hyper-V console to access file server resources, e.g. VHD (not supported in production) or ISO’s.
Make sure that either the computer account of the Hyper-V host or EVERYONE has at least read access to the library share(s).