Like a lot of poeple here, most of the time, I use my 2nd monitor (two 2005fpws) to keep all the apps that are constantly running visible. I have a finder window open, iTunes, pearLyrics, Adium, and Mail open and visible all the time. Underneath the Mail app is the Address Book, and (right now) ecto.
When I'm using Photoshop or InDesign, the paletts are just on the other side of the bevel between the screens, with the document on the main screen. Occasionally, when I have to work on a legal sized document, I'll rotate the second screen vertically and work with the document on that screen.
I've fallen in love with having two screens, and having that dedicated space for all my everyday apps to live.