I actually finished it over a month ago, but didn't want to post finished pictures until after I gave it to the recipient. I really want to see it on her and really hope they get some good use out of it before she out grows the sweater!
You can see my progress here: http://rainydayart.blogspot.com/2009/08/on-neeldles-baby-hooded-jacket.html and http://rainydayart.blogspot.com/2009/08/progress-and-kitchener-stitch.html
This is a closeup of the seam on the hood. I did that differently than the pattern too. The pattern said to bind off the outer edges and continue knitting the middle to make a T shape and then sew the edges together on the back of the hood. I knit the stitches together as I went so I didn't have to sew the seams. It didn't save me anytime because I tried out a couple different methods. It was like a heal on a sock only hood sized.
After all that I bought the buttons and sewed them on. There's really no avoiding that kind of sewing if you want buttons on the front. :p