Google announced their Google Gears project today which uses SQLite to allow browser based applications to work off-line. (Ryan and JD have more info on that). Part of the announcement was that the upcoming beta of Apollo will also include SQLite to allow developers access to an embedded database for their applications.
This has probably been the #1 request we have heard from developers since we release the alpha, and with a tons of help from the Flex team, we were able to add it.
We will be releasing more information once the Apollo beta is public on labs (sooner rather than later).
Update: I meant to add that we are working on aligning the Apollo DB and Gears DB apis, with the goal of making it easier to build applications and code that can leverage both API implementations (on the desktop and in the browser).