My bootloader of preference was originally Optiboot for the Babyduino project due to it's small size and inclusion in the newer official Arduino boards. Despite a fair bit of effort I failed to get a working version compiled and running on the ATMega8 (this is the chip I'm using for the initial Babyduino design).
After a few fruitless nights of playing around with it I finally switched to the bootloader provided on this page. Right now this compiles and runs quite happily on the ATMega8, compiles for the ATMega88 and has some issues with the ATMega168. So far I've only tested the ATMega8 version on real hardware, I'll test the other chips over the next few days.
Now I've overcome the first major hurdle I can progress a bit more on the project which is a relief - the past few days have been very frustrating.
So what comes next? Obviously I need to update the project page with the new changes and some instructions on how to install it now that it is actually working on at least one configuration.
My ISP adaptor is working well so it's about time I migrated that to a more permanent configuration - I don't think inserting and removing chips from the breadboard is very good for them. I only really need one of these so it will probably get soldered up on some veroboard with a ZIF socket rather than have a custom PCB made for it.
The next step is to test some additional chips. As I've mentioned I'm planning on supporting the ATMega8, ATMega88 and ATMega168 in the initial release. Once I've tested these and verified that everything works I'll do up a PCB layout for a breadboard module in SIL format.so it's a bit easier to layout projects.
Then I can finally get to work on some pending projects :)