Donal, Jonathan and I are hacking away crazy at the Moodle Network (formerly known as Moodle Community Hub). It includes the multi-auth refactor (done), a rather cool WS/RPC layer (done) and is now to the point where you can set things up trivially in the admin area to get SSO across 2 Moodles.
We are gearing up to be ready for a demo for Friday. Who said panic?
The code is based on the early betas of 1.7. If you want to give it a test drive, or look at it a bit, and you can find it at http://git.catalyst.net.nz/gitweb?p=moodle-r2.git;a=shortlog;h=mdl17-mnet - you can click on 'snapshot' to download it. Or use cogito to get hold of it.
From that same repo you can get the mdl17-mnet-rpc and mdl17-mnet-multiauth which have only the RPC and the Auth code.
Once things settle a bit we'll be looking into merging the multiauth and rpc parts into HEAD. I am actually pretty happy with how this is shaping up...