Theres an official wllpaper for Ubuntu 7.10. Come here and see it :D
Like my article on Conky, this is one of my favorite techniques to use on any Linux distribution. This technique - utilizing devilspie - will create a transparent terminal session on your desktop that will remain for the duration of your login (unless you exit the terminal session for some reason).
Animated wallpaper may not be very useful, it just looks sweet. In this how-to I will explain setting up an animated background that works with Compiz Fusion on Ubuntu using a program called XWinWrap.