When moving from msde to a sql database what happens to the users do you have to activate them all or will they automatically update?

No, there is no need to go thru the activation again.

cool, so it should pretty much invisible to the user bar the detach/attach time and no user interaction required.

Yes, it should. I did this a couple of years ago and the users never noticed a thing.

However, if you are using any role-based administration, you may have to set up those users again with their roles. See this:

After migrating the BlackBerry Configuration Database role based administration does not work

Also, I assume you're following these instructions for moving from MSDE to SQL:

Move from an MSDE database to a Microsoft SQL Server database

yeah cheers

You can look my notes when I did it

BES 4.1.6 MSDE to SQL 2005 almost ready to do it

cheers mate