I updated my phone to 2.1 and tried a live wall paper. Earth rotation. I could see it listed in the apps but couldn't find it to run it. Do I have to be rooted to run them? How can I tell? Yes I checked for it to run any app.
Did you hold on the home screen and select wallpaper>Live wallpaper?
YouTube - Android new Live Wallpaper : aCircuit Board
I also love live wallpapers!