We developed the underlying technology for the new, "auto-blend layers" feature in Photoshop CS3, which can seamlessly blend a stack of aligned, overlapping image layers. The most common usage is panoramic stitching; simply use the Photomerge feature for one-step construction of a panorama from a set of photographs. The technology behind auto-blend layers is described in several SIGGRAPH papers.

Here are a few links to articles and videos about the feature: