I caught up with Steve (jazzed on the Parallax Forums) last weekend in person - he has been working on porting linux to the Propeller. Sounded a bit ambitious to me, but he has been working with Heater and they already have Zylin's ZPU processing core up and running on the Propeller - uclinux can be compiled for ZPU - the only thing missing is memory.
Jazzed has been working on that, too - he showed me a prototype he's been working on that expands the Propeller Platform with 32MB of sdram -
After talking, he decided to expand the design a bit to include some more features;
It adds an ATTiny to manage keyboard / mouse input, composite and VGA output, Audio out, and a microSD card slot. I think it's really sharp - not only will it be useful for getting linux running on the prop, but 32mb of sdram can be used for any other project. He showed me the object he already has and it was really easy - just readlong and writelong.
Hardware won't be ready for about a month & Jazzed says the linux port will take a while longer, but I'm really excited about it - especially seeing how easy it was to use.