"Question is there a way to tell SMS to run a package as a specified user? By default, I only see two options: User context or Administrative, which runs the package as localsystem (not good when my packages need to resolve env. variables not available to localsystem). Can I specify a specific account with special rights to install a package as? Thanks!"
The straight answer to this is no. You can only run as the local system or as the current user. If you need to run in an admin mode but using the current user for enviromental vars then you can't use the SMS depoly to to this. There are some "wrappers" that you can use that will elivate the install as the current user to an admin so it will install using their env variables. Their are some other ways but it is not easy. I was forced to install an app as the local system but I had it map some drives that the user would have and then afterwards I changed the "current user" registry so it will work for the local user and not the local system.