Not the first and not the last. I was bored tonight.
I took cues from a few different places. The FDTI cable is connected funny because I don't have any extra long male headers right now.
Blink sketch, etc. Auto reset, etc.
Before someone says anything, that green LED lacks a resistor because it has an internal resistor (designed for 5V operation).
I did this because I plan to make a permanent custom Arduino on some soldering protoboards.
Only problem I had was switching TX and RX and subsequently having major issues, but I eventually figured that out. (Careful, this mistake caused some heating in my case.)
I'm posting this hoping it will be useful to someone.
GND goes to the ground bus you chose on the breadboard/protoboard.
+5V goes to the +5V power bus you chose on the breadboard/protoboard.
TX goes to pin 2 of the ATMEGA through a 10k resistor.
RX goes to pin 3.
Auto-reset functionalityh is accomplished by connecting the green wire of the FDTI cable (opposite the black ground wire), also labeled RTS by ladyada, to pin 1 through a 0.1uf capacitor.
I did not put a power supply on that version because I was just testing it. I'd just use an LM2940 or 7805 regulator and some capacitors. A 1N4001 protection diode and PTC would be good too, but I don't have any PTCs. The pictured circuit would not be pleased if you reversed the power supply, so at least a 1N4001 would be needed.
(Cathode to the VCC/+5V bus, anode to the GND bus)