Well, I didn’t jump on the Twitter bandwagon – the last days my feed reader was quite cluttered with blog posts starting with t and ending in witter – but the twittervision map mashup nicely demonstrates visualization of rapidly changing geotagged content.
As far as I can tell, after having a quick look at the Twitter API, the map solely relies on geocoding services. There is only a <location> element containing place names in the Twitter data stream, no GeoRSS or any other geotagging method has been applied yet.