This post is updated
Firstly, I'd like to thank evilSOB for recoding the entire system, which now works great. Second, thanks to VeT for his immense interest and help.

Here's the first demo in a series:
Fluid simulation demo 1 download (hosted my own site this time, so the link won't die)
left click and drag across the plane for a nice 'liquidy' effect.

TODO and Upcoming things:

• Improve the frame independancy(less 'shaking') - DONE
• Release a demo (and tutorial) that works with newton physics - 70%
• Splash particle effects - 60%

Anyone with suggestions, bug reports, or anything like that, please share!