As many of you will know one of the things that bugged me about Windows Vista was the photo import tool was a regression compared to Windows XP. You could only import all the photos from a connected digital camera, you couldn't select the images to import.
However with Windows Live Photo Gallery (currently in beta), they've changed that by adding a way to not only select which photos to import but also group them, allowing you to quickly select a mass of images that all have the same date for example.
Another key improvement in my opinion is the ability to resize images in batches, Windows Vista has a photo resize tool, but the only way I could find to launch it was to use the Send to e-mail feature, now you'll be able to right-click on images and select resize.
On top of those there's also an ability to stitch images together, lots of new ways to tweak images and upload to Windows Live Spaces. You can install Windows Live Photo Gallery beta by using the new Windows Live Installer. It is however still in beta, and needs a good few months to polish it up a bit and match the stability of the existing Photo Gallery in Windows Vista.