Well, I downloaded the Visual Studio 2008 Express version and played around with it very briefly yesterday. So far I haven't played with too many of the new features yet, but hopefully I'll get a chance to over the weekend. Here are some initial comments of mine.
The Good: The install was a breeze compared to Visual Studio 2005 Pro.
The Bad: I still have to support classic ASP applications, and it looks like the intellisense for classic ASP has pretty much been removed. Bummer.
The OK: I like that the .Net framework 3.5 integrates the AJAX framework out of the box. It looks like most of the interface is pretty much the same as Visual Studio 2005, so I won't be hunting for things all the time, which is nice.
Overall I like how Microsoft is giving away Visual Studio and SQL Server Express versions away for free.
Download copies for yourself -