The LEGO Company just launched LEGOFactory.com [3] an interactive site based on LEGO's free Digital Designer software, which will allow kids to enter a competition and possibly have their model produced as an official LEGO set! LEGO Digital Designer [4] is the company's freeware CAD tool designed for kids. LDraw users are now talking about writing converters between LDD and LDraw files, an idea the LDD team has been open to for some time. If you are a developer, join discussion at lugnet.cad [5] and contribute to the creation of a converter!
Also, see Jake McKee's original announcement on LUGNET [6].