I found the answer here in another message
http://ww.wp.xz.cn/support/topic/53019?replies=1 This fixed all the problems by getting rid of having to use GD 2.0. The whole thing took less than 10 mins to change over. Thanks to the original poster of this hack!
Same deal here rh9 production box and unable to update the OS. Server is working fine other than not being able to use GD 2.0 .. Any ideas?