Pascal Stang is really nice to make the AVRlib freely available for AVR developers. (he is also the author of ARMLib).
The AVR Lib contains codes for nearly all the function that AVR chip provide, eg. UART, I2C, SPI, PWM etc. Also it includes some high level functions like IDE/CF, GPS, LCD modules.
I didn't try it, but I am going to use it for the next project. Stay tuned.