It'll be a couple months before I really get cranking, but I expect to be finished with the book by the end of the year. I'm also planning to make an extended screencast series once the book is done. You can follow the project's progress at http://railstutorial.org/.
I went through this book when I was learning Rails. I liked the fact that by the end, I had accomplished a bunch of things that I knew I would use again and again. http://www.amazon.com/RailsSpace-Building-Networking-Addison...
For a have on hand reference: http://www.amazon.com/Rails-Way-Addison-Wesley-Professional-...
And a good compilation of beginner resources: http://rushi.wordpress.com/2006/09/24/ruby-on-rails/
N.B. As with virtually all Rails books, it's a bit out of date (despite having only just come out last summer!), but we focus on general techniques that are plenty useful in Rails 2. I'm currently building a site with some of the same features as the book application, and I often find myself referring to the book for guidance.