First and foremost, my number one recommendation is Winterboard, which quite simply an app to change the theme.  There are countless resources for pre-built themes or for the artsy you can make your own.

Beyond the visual customizations, there are a few apps that simply make the OS more useful and organized.

SBSettings adds a slide in UI that can be activated by sliding your finger across the top of the screen from anywhere.  It gives you quick access to turn on/off settings like bluetooth, wifi, 3g, and others to save on battery life.  There are also addons for more functionality like managing resources and enabling SSH access to your device.

Backgrounder and Kirikae work together to add the ability to multitask apps as well as quickly/conveniently switch between different apps simply by double-pressing the home button.

I have apps installed to enable downloading of any file type in Safari, and one to download YouTube videos for offline viewing.

Lastly I have emulators installed for all of my classic gaming needs from NES to PSX.

There are a whole lot more apps that would be more useful to iPhone owners that tweak SMS/MMS capabilities, and one that enables WiFi tethering.  I’m still pretty new to this whole thing, but thus far I think JB Apps pretty much adds all the functionality that I had always wanted my iTouch to have.

For iPhone 3.0 users the easiest way to jailbreak is using blackra1n.  The process takes under a minute, and is as simple as plugging in your device and hitting a button!