In case you have installed the .NET 3.5 SP1 and Visual Studio 2008 SP1 and are unable to find the Dynamic Data Website Template, you can install the latest version of the runtime from http://www.codeplex.com/aspnet/Wiki/View.aspx?title=Dynamic%20Data&referringTitle=Home
To explain it further, I had the December 2007 CTP installed which contained the Dynamic Data Runtime and Astoria, Entity Framework etc., All of these gets bundled into the .NET 3.5 SP1 Beta and you dont need the December 2007 CTP any longer. So I went ahead and uninstalled the December 2007 CTP.
Post the uninstallation, I was unable to find the "Dynamic Data Website" Template. After some research I found that instead of fixing the issue by installing/uninstalling SP1 Bits again, it was better to install the latest bits of the Dynamic Data Runtime from CodePlex. The other advantage is that, you also get the "Dynamic Data Website Wizard (Preview)" that allows you to configure a data driven website very quickly, by following the wizard steps.
I would experiment with these bits and post my experience in my further posts. Till then, happy exploring.
Cheers !!!