The new Microsoft SQL Server 2005 driver has been released and can be downloaded from here. The new driver is a type 4 driver that has been completely written from scratch and supports SQL Server 2000 as well as 2005. Accoring to MS, its been tested against Weblogic, Websphere, JBoss and Sun AS.
Currently I’m using the jTDS drivers for connection to SQL Server and they seem pretty reliable. Its probably a bit early for any comparisons (the new driver was only released yeaterday), but if anyone knows any, please post a link in the comments.