Working on a new theme for the next Digging into WordPress book update, I found myself really getting into the whole “widgetizing” thing. Widgets enable non-technical users to customize your theme according to their specific layout needs, and with so many different widgets available, the possibilities are endless. You may have thought about widgets as something you do in the sidebar, but there is no reason to stop there. You can widgetize just about every part of your theme. In this post, we’ll show you how to do widgetize your theme in two easy steps. Once we get the basics down, we’ll dig into some sweet tips and tricks.

Great information, next I like to know how to create widgets in Wordpress plugins

All bloggers would like to get more interaction and participation from their readers and visitors. In this post we’ll look at nine different things you can do to your WordPress theme to add the possibility of some type of interaction. Some involves comments, social media, and other ways of getting readers involved.

Nice list of hacks, but most of them are replaced by current widgets or plugins.
The problem with hacks is that after they are placed they stop working if Wordpress has changed some code. The blog owner need to fix that code while a plugin is often fixed by a group of users. I like to use custom functions too but don't like re-invent the widget wheel...