Raul Valdes-Perez, the CEO of Vivisimo (the company that brings us Clusty) has written a column for News.com about how the "best" search personalization is done by the individual. Here's our introduction to Clusty.
I've also found that dynamic clustering can be a useful knowledge discovery tool often finding themes, concepts, etc. that would be difficult to see without the clustering.
The Valdes-Perez column: Narrowing the search, also discusses some clustering/interface research being done at the University of Maryland.