I have taken a quick look at some of the most popular AJAX libraries. Wow, I had no idea there were so many. Long story short, it looks like the pre-release Microsoft Atlas is not well documented enough (and probably not stable enough) to use just yet. There are many other integrated ASP.net + JavaScript solutions, but they all appear to be fairly home grown and narrow in their feature sets.
For dynamic JavaScript behaviors, I recommend trying the Yahoo UI libraries. They won’t do everything, but are fairly comprehensive, well documented, stable, and BSD licensed.
I also briefly tried a new IDE called Apatana which is free and specialized for JavaScript (and built on Eclipse). It is slick, and could be useful for prototyping behaviors before moving them into an ASP.net project. Its most useful features are JavaScript intellisense and built in sample projects.
Other contenders:
MS Atlas
Scriptaculous
Dojo – nice buttons and effects
Ajax.net (ajaxpro.info) – csharp samples
EmergeTk – .Net integrated, but broken demo site
MochiKit
AFLAX – Javascript + Flash
Prototype (base for scriptaculous)
Jquery – not many demos
Rico
Many more: .Net libraries: http://www.daniel-zeiss.de/AJAXComparison/Results.htm
Good blog: http://ajaxian.com