In .NET 3.5 SP1 the following features are added to the DataContractSerializer.
1. Support for POCO types. Aaron has a nice writeup here. I have updated my post on Serialization Rules to include this.
2. Support for get-only collection properties.
3. Support for schema-verifiable multiple object reference (i.e using the same instance of an object in two places)
Another new feature worth mentioning is the support of XmlSerializer for serialization of faults. I will write more about each of these features in the near future.