I upgraded my MacBook to Leopard today (brave early adopter!) and ran into the problem of hanging at the blue screen immediately after reboot. I’m not the only one that’s run into this.
This fix worked for me: reboot from the install DVD (hold down ‘c’ after power up). On the 2nd or 3rd install screen go into the options and select “Archive and Install”, with the option to bring across your user data.
If you’re not hankering to run Leopard, I’d wait. Or, do a full backup first.
It will be really interesting to see how Apple handles this.