Hey Jon, I didn't want to comment until I had dug into LINQ a little more and could give you a half decent reply.
I'm just starting to realise the benefits of LINQ and think it does indeed rock. There I said it.
However, I personally think the big wins for it are the extra features it brings to the C# language. For example, the other day, I wrote an extension method that enabled me to discard an entire decorator class!
Its quite interesting to see how LINQ has evolved based on the introduction of Generics in version 2.0 of the .NET framework but I'm concerned that the the line between functional and imperitive features of C# will become more and more hazy(?) and that the language will become more complex.
I've used Linq to SQL and think its ok but I see persistence issues as secondary these days to object interaction and understajnding design patterns. That said, I'm looking forward to get the chance to grok up on ADO EF and Linq To Entities (when I can) as I can see that lighting up my life...
 

Entirely with you on the "persistence issues as secondary" bit.

Out of interest, how are exposing access to your persistence layer?

I'm generally leaning towards a loose interpretation of the Repository pattern nowadays with a simple Repository Interface which exposes data as generic lists, or (for updates/inserts) accepts objects as arguments to functions.

A (Rob Conery inspired) variation being to expose the data as IQueryable (exploiting the benefits of delayed execution)