I have P4080 board, which is better/recommended to use to build the images...is it SDK from Yocto Project containing containing Bitbake (or) an .iso which contains LTIB?
I've answered this question already in Service Request. Shortly - if you have P4080 board from third-party vendor, than this board in not guarantied to be supported by our Linux SDK, and you have to use Linux BSP supplied with board by board vendor.
We use bitbake in our Linux SDK, but your board vendor may use LTIB in its Linux BSP for this board.
If your P4080 is rev 3, you need to use Yocto SDK 1.3 or later version as this is not supported in previous SDK.