It is possible to boot the Xserve from alternate boot volumes without using a keyboard or mouse. Press and hold system identifier light button at start to select from the boot target.
The options we use most often are:
Light 1 (far right): Start up from system disk in CD drive (also, eject any disc in the optical drive).
Light 2: Start up from a network server (NetBoot).
When we receive new orders of Xserve’s, we deploy our default image using Deploy Studio
More information is available within the Apple Knowledge Base article TA26930.
Our video below shows more information on how this works in action.
[qt:/r/videos/CM01-Xserve-Boot-Panel.mov 800 450]