EeeXubuntu developer oasisbob has released the third version of his custom Ubuntu distribution for the Eee PC. The main improvements in eeeXubuntu r3 are support for additional Fn hotkeys. In r2, you could use the Fn keys to adjust the brightness, but that was about it. Now everything except for the WiFi toggle switch seems to work. Oasisbob has also made it easier to create a bootable flash drive from the live CD.

If you're already running eeeXubuntu r2, you can upgrade to r3. But be forewarned, the upgrade process has not been thoroughly tested, and you could wind up messing up your system.

For more info about installing eeeXubuntu, or info on what works and what doesn't, check out the eeeuser wiki.