Standalone atmega2560

GoingForGold:
One more question: is the Arduino USB connection just a FT232 adapter? Or is there something special?

Yes, the FT232 is a good option. I have have been using a CP2102 USB to serial adapter like this one: http://www.ebay.com/itm/CP2102-Module-STC-Download-Cable-USB-2-0-to-UART-TTL-6PIN-Serial-Converter-/320961133239?pt=LH_DefaultDomain_0&hash=item4abac63ab7

I don't remember which ebay seller I bought it from though.

You have to modify it a little to work with a bare Arduino. It requires the DTR pin to go to the RST pin through a 1uf capacitor and the original RST trace must be cut. It is easy.