Back in December of 2008 Yehuda Katz announced that Merb and Rails were merging and the by product would be Rails 3. Fast forward to Feb 2010 and we are just around the corner from that being a reality. Rails 3.0 is a major upgrade to nearly every part of Rails. The router and query APIs have seen the most radically refactorings.
Serious deprecations will occur as part of this transistion, but there is still a lot of backwards compatibility support that will be available for a short time. Rails 3.0 adds Active Model ORM abstraction, Abstract Controller generic controller abstraction as well as a consistent Plugin API giving developers full access to all the Rails internals that make Action Mailer, Action Controller, Action View, Active Record and Active Resource work.
There is a great guide on over at Rails Guide that talks about converting an existing Rails application to 3.0. We have flipped the switch and are now doing all new development officially in Rails 3. Furthermore, we have started our strategy to convert existing applications to Rails 3. We would love to hear about your experiences with upgrading and your current strategies for new development.