According to SolidCoin, there is a 1 in 32 chance that a block is a PowerBlock, the number of coins you generate in a power block is double a normal block.

You can't use a random function to determine if a block is a powerblock because other clients wouldn't be able to verify it.  You also can't use information in the block being generated because a miner could manipulate it to make every block a power block.  The only thing you can use is the block chain since that's the only state that all clients share, and, that is what solidcoin does.

Here's the code that determines if a block is a power block:

bool Block_IsPowerBlock(const uint256 &trustedhash,const uint256 &userhash)
{
    unsigned char trustedcount=trustedhash.SumOfBytes();
    unsigned char usercount=userhash.SumOfBytes();
    if(trustedcount>=128 && usercount>=239) return true;        //1 in 16 chance for user, 1 in 2 for trusted, = 1 in 32 total
    return false;
}

It is called with the two previous block's hashes as arguments.

Since you can tell if a block is a power block just by looking at the hashes of two prior blocks, you can decide if you want to mine the block or not. You can choose to only mine power blocks.

I don't think this works out to exactly 1 in 32 blocks in practice since a good hash has to have some number of leading zero bits, as the difficulty gets higher the chance of a block being a power block goes down slightly.  Although this is unintended, it probably isn't bad.

If you only mine powerblocks, you'll get a higher payout for your cpu cycles. Most of the time (about 56 minutes per hour) you'll be idle. During the down times you can mine some other coin (like litecoin, or another cpu-friendly coin).

scrypt is designed to scale in both processing difficulty and memory use,
however, litecoin doesn't seem to have any way to change either. This seems like a big oversight, in a few years it won't be so gpu unfriendly.

For the salsa 20 hash, litecoin uses the 8 iteration version.  There have been identified attacks for 7 rounds, this doesn't leave much margin of error.  The 12 round variant seems much safer.

Anyone know why these choices were made?  Are they just copied from tenebrix?

The protocol https://en.bitcoin.it/wiki/Protocol_specification includes a lock_time field for transaction (bitcoin doesn't currently implement it), the description from the wiki: "The block number or timestamp at which this transaction is locked, or 0 if the transaction is always locked. A non-locked transaction must not be included in blocks, and it can be modified by broadcasting a new version before the time has expired"  Then in TXIn there is a field for sequence, describe as: "Transaction version as defined by the sender. Intended for "replacement" of transactions when information is updated before inclusion into a block."

What is unclear to me is what changes to a transaction would be acceptable in an update, could you change the source coins, the destination address, the script?  And, if they are changed, how would miners determine that this is an updated transaction and not a new, totally different one?

There are regular threads here about how bitcoin isn't backed by anything, generally followed by a plan to back it with gold or silver or dollars, however, every one of those plans relies on a central authority.  This doesn't work since that central authority is subject to bankruptcy, corruption, and government influence.

In order to keep the distributed nature of bitcoin you would have to back it by something that is itself virtual.  That got me thinking that maybe Namecoin is really a backed virtual currency.  Even if the dollar/bitcoin/whatever value of namecoin went to zero, you'd still be able to use it for something. Currently, that something is registering domains but it is set up to allow you to store name/value pairs.  This makes NameCoin a currency that is backed by the right to use a distributed data store, pretty interesting.

I was looking on block explorer and I saw this:
http://blockexplorer.com/tx/1dc3384e7ffedf0036b0fd269f3fe46fb08e8c1436bb11f9d083e236cd0f620f

Two inputs, one 5.87BTC and one 10BTC.  Then, two outputs, one for  10BTC and one for 5.87BTC.  Obviously, this transaction could have been a single input and a single output.  Is there any reason why it would be better to have two inputs instead of one, or is it just a bit of brain-deadness on the part of bitcoin?

I saw someone had mentioned Listia in a different thread.  I have decided to test the waters by auctioning 5 bitcoins on Listia.

http://www.listia.com/?r=135367
Search for BitCoins
Auction Ends: Sat July 31st 1:40 AM AZOST (Not sure what TZ that is, but it is 10 days from this post.)

Listia lets you auction off stuff you have for credits.  You can then use those credits to bid on other auctions.  No need for cash to change hands.  In some ways it is like craigslist but without freeloaders.  You get some credits just for signing up and at random other times.