Seconded. 20% time is still real, if you ask/push for it. If your idea fits somewhere under the broad umbrella of your group's mandate, so much the better.
I have to disagree a little with one of the earlier points, though. Through start-up acquisitions, Google is getting a lot more groups with the developer/hacker mindset. Those groups tend to keep to themselves and rail against Google's slow pace, and often eventually quit. Google could learn from that mentality, but equally those developers could learn from Google's methodical approach. In my (limited) experience Google could do much better at integrating newly acquired start-up teams into the overall corporate culture and development philosophy.