Android developer Manup456 has recently updated his Eclair ROM for the T-Mobile G1 from Android 2.0.1 to Android 2.1. The step up to the 2.1 OS means that Live Wallpaper is now available to G1 users should you wish to follow the step by step instructions to get it loaded up on your phone. If you were running Manup456's ROM before the latest V1.5 then another thing to note is that the camera now works in the latest 1.5 version of his ROM.
So, if you want to test out the latest Android ROM on your G1 then check out the thread over at AndroidSpin or XDA Developers that includes full steps to get it working on your phone.
The video below shows the previous version 1.4 running on the G1 which just had the static background. Of course in 2.1 the Live Wallpaper is now functional.
As with all ROM changes, make sure you read the instructions fully, sort out the software tweaks and make sure you have the correct radio installed... if that's the case then go ahead and install. Something else to note is that you need to perform a wipe on ext, data and dalvic as per the instructions found here.