I just came up with a simple plugin for generating demonstration pages for jQuery plugins. A demonstration page contains plugin options, code corresponding to the options and the plugin itself. This makes it possible to modify plugin options in real time and see how they affect the result.
I developed the plugin to make it easier to document qColor, a palette plugin in development. It sort of grew out of the project as I thought it might be useful as a component of its own. I think the plugin provides interesting alternative to static text based documentation. It probably cannot replace it altogether, though.
You can find the plugin and some initial documentation here.