I've read a variety of these and having just sucessfully done a upgrade install, rather than the mooted archive and install I thought I'd write some notes.
Run software update and ensure that you are up to date, running 10.2.8, this seemed to be key for me.
Bin all your old stuff - have a really good clear out, chuck away old pictures and music and temporary files. You'll want 2-3G free on your main drive at least.
Delete old apps or demo applications, work out what you really use.
Clear out your desktop, most applications you download you can delete once installed, they will probably be updated before you need to install them again.
Backup your entire home folder - buy an external firewire hard, they are pretty cheap these days, one hundred quid will get an 80G disk from Dabs or something similar from the Apple Store.
Don't forgot /Library/Webserver/
Do test your backup, select a random file and restore it, then check the file.
Do the upgrade install happy in the knowledge that you have a decent backup
Customise the install, remove languages you won't ever use and printer driver packs for printers you don't have, you can save 5-700 Mb here, useful if you have an older iBook, or a stuffed TiBook in my case.
Once you have done that, Panther is really very nice Exposé especially rocks.... it is so completely natural to use, I find myself playing f9, f10, f11 games in time with the music on iTunes... I was bored, ok.
I'm finding Panther faster, than Jaguar was on my 1 Gig TiBook. Mail is especially quick on checking, it seems to overlap the disk based tasks with network tasks better, so you get to 33 of 33 much faster. A few other nice things, the integration of application swtiching with Command Tab and expose is well implemented. I have now happily hidden the dock, as I don't really need it any more, it is still a drag surface for opening some files, but I know where BBEdit lives.
Newer Safari is good and they have fixed one of my pet bugs, Command W closes a tab, not the entire window, though closing a window does not tell you that you have other open tabs.
User switching looks beautiful, the entire window shrinks to about 90&percent; before rotating the cube, which looks perfect.
Like Paul I'm a convert to the new Finder windows, it makes sense to have everything moving left to right, rather than having some things on top. The new Eject button beside removable items in the window is a great idea, a pity it took ten years or more to work it out.
There is probably loads more cool things, but that it me after a week to ten days after install. Plenty more at these places MacNetJournal, Macintouch.com and O'Reilly MacDevCentre.

Question: Can I run the install from a disk image rather than the instlal disk itself? Just wanna make sure before I finally upgrade.
Just in case, I'm currently using OSX 10.1.5 on a 433Mhtz G4; 1.1 GB RAM.