Making Things Talk - 2nd Edition
I loved the first edition of this book when I started with Arduino. I don't read many educational books that end up dog eared from over use and this one really did!
The 1st edition book covered most of the real world examples that were the building blocks of many real world projects (if not all).
For Arduino, it taught me everything from lighting a simple LED, reading sensors such as gps, communicating over networks, controlling motors, sending radio messages +++.
A little bit of many fun things delivered simply in an easy to understand format.
Making Things Talk - 2nd Edition
The 2nd edition looks similar to the 1st but since I read the book there have been a number of hardware and software changes with the Arduino. Therefore I am recommending the 2nd Edition without having read it.