Microsoft Pro Photo Tools 2 and Photo Calibration Tool provide free photo geotagging options

Microsoft is providing two free tools with powerful digital photo geotagging capabilities, both manual and automatic.  (NOTE: I haven't tested them yet.)

Microsoft Pro Photo Tools 2 (for XP and Vista) can read track logs in a variety of formats (NMEA, GPX, LOG and KML and automatically geotag photos against those track logs.  Otherwise, you can select a position on MS Maps.  It will also do reverse geocoding, turning a GPS position into embedded location (city, state, country) tags.  It's a free download.  For more information about how to use it, read Geotagging Goes Mainstream by Tim Grey.

Another option for geotagging in three dimensions (e.g. locating a photo on a particular floor in a skyscraper) is Microsoft Photo Calibration Tool.