I recently attended an event for veterans held at the Houston Community College where I learned the details of an amazing new educational program for veterans that blows the previous GI Bill out of the water. 

After August 2009 the government will now pay for all in-state college tuition, give a book allowance, AND give a veteran BAH (BAH rate of E-5 with dependents).  You do NOT have to have contributed the $1200 during your first year of service to qualify for this. 

There are some requirements, like you have to have served in the armed forces for 36 months to receive full benefits, but even those who served less time may still qualify for a reduced educational benefits package.

For details go here:

Post-9/11 GI Bill Information