I used to make blender games way back I was wondering what version do you guys use now? Any new features worth using?

Yes. Blender 2.48 has realtime buffer shadows, realtime normal/parallax maps, realtime shading nodes, realtime stencils, and multitexture materials.

Most notable features include:

GLSL: Normal maps, spec maps, you can even customize shaders with the node system! All of this is done just like when you set it up for an internal render (although some things are a little different).

Realtime shadows: You can now cast realtime shadows from spot lights.

Soft Bodies: Soft-bodies have been implemented, though not quite ready for much more then awesome cloth and jello simulation.

Linking: You can link objects between blend files now. It’s very important for large, organized game projects.

However, trying to delete duplicate texture and material datablocks that will still drive you insane to the point of tearing your eyes out. Luckily, this can be avoided with extremely precise and careful planning, and the use of the new Linking features.

(Go Here for all of the new 2.48 features in this release log!)

Download 2.48 and view it all in action; Martinsh’s demo pretty much sums it all up.

Nice! So most everyone uses 2.48 now that its come out or are there any significant problems as far as the game engine?

Most people use the newest edition. It got a lot of love with apricot and it’s the one to use these days. I haven’t noticed any issues