This release of Wordpress is principally a bug fix and security release. This version fixes the problems talked about here (http://blog.dalegroup.net/archive/blog/newsid/149) and also a few other problems. The full run down can be found here:
http://wordpress.org/development/2004/10/wp-121/

It is highly recommended that you upgrade to this version asap.

[quote]Upgrading from 1.2 is very easy. Your existing templates and plugins should work just fine; all you need to do is overwrite the wp-* files and folders. To upgrade:

1. Download 1.2.1
2. Unzip
3. Upload the new files to your site, taking care not to overwrite anything you may have modified like index.php
[/quote]

To download the latest version see this link: http://wordpress.org/download/