Well the way i have my set up is my Droid running UltimateDroid 8.0.0 is broadcasting the signal, and the Droid with CyanogenMod 6.0.0 is the one receiving it.

I think that is what furbearingmammal originally meant when he said his Droid picks up Ad-Hoc networks. It is because he is using CyanogenMod 6.0.0 on the Droid receiving it.

I dont know if there are other ways out there to connect, but this so far was the simplest to me.