This is a very good article. The ideas fully apply to 2000, 2005 and will to 2008. And also to any application development: Do not hardcode the changable stuff.

One comment: I have heard from developers that they use LocalHost in order to avoid specifying the server name if their application will work on the same server as a database server. Not a good idea if you later decide to move the application or the database to another server or to use a named instance. The configuration files will do better.