I'm happy to announce that the Team System Rangers have just refreshed the Project Server 2007 to TFS connector that was originally released last year.  This version has been made compatible with the recent release of TFS 2008.  In addition, we've fixed a number of the most commonly reported bugs from the first 6 months of usage by customers.  There are some important notices that accompany this release:

• If Connector installation fails immediately, it may be due to the fact that the VC++ 9.0 runtime assemblies have not been installed on the machine. This issue was found late in testing; however we did not want to further delay getting the Connector to you. It is only needed for installation and is not needed for the Connector to run. We will be removing this dependency in a minor release (coming soon). For now, you must run the vcredist_x86.exe that is included with the Connector installation file if you run into this issue.
• A change that was made to a TFS 2008 API such that the process template information is no longer maintained with a team project. However, the Connector depends on this information to determine how to map fields within a team project to fields within a PS project. Please see http://blogs.msdn.com/lfenster/archive/2008/02/14/getting-a-process-template-for-a-team-project-in-tfs-2008.aspx for a full description of the change and a tool to ensure that your team projects have the necessary information for the Connector to work effectively.

Many thanks to Lenny Fenster for his contributions to this project. 

I'm eager to hear how this connector works for you and what additional improvements you think need to be made. You can post your thoughts directly to the project site on Codeplex.