Hi Dave

I used an old Canon 350D 8 Mpixel camera and can give you the following pointers:

1) Make sure your camera is level i.e. take a spirit level and check for a level camera right around 360 degrees. If the camera is not level, I found that the horizon waves when all the photos are stitched together (I might be wrong here, but it is what happened to me).
2) Place your camera in portrait mode on the tripod, set your camera to manual focus, and try to set the focus such that most things look clear.
3) If possible, switch your camera to manual mode, meter right around and choose the best exposure time to fit with an f-stop value of 12 or so (this f-stop value will give you a better depth of field with more things in focus).
4) Take photos right around with the horizon roughly in the middle of the frame, and allow for at least 30% overlap. I initially used a focal length close to 50mm, but found that I could get away with wider shots (I think the focal length was closer to 30mm and this worked well).
5) Tilt the camera up a bit and take another round of photos. If your sky does not have clouds on the day that you take the photos, don't even bother trying to stich it together. See the note on skies below.
6) Tilt the camera down and continue taking photos until you feel that you covered most of the scene with adequate overlaps horizontally and vertically.
7) Stitch your photos together. I've had mixed results with Autostich, but it's worth a try. I've used a freeware tool called Hugin with a lot of success. There are many tutorials available on the web on how to create pano's using Hugin. One of it's good features in my mind is that it enables the user to define straight horizontal or vertical lines (such as the horizon over the ocean or straight edges of buildings), and this eliminates those horrible wavy horizons.

Notes on the sky:
Flying in a simulator using a pano with no clouds makes it quite hard to orientate yourself if you lose view of the ground. Clouds give you a sense of movement and speed when you can't see any land. We often have no clouds here (especially on days when I want to take pano photos!), so I cheated a bit when I created a pano of our local flying field. I stitched together one of the beautiful sky scapes that come with FS One (they are broken down into tiles just as the scenery). When I stitched together the land portion of my pano, I erased the remaining blue sky from my pano, and then placed the FS One sky of my choice on a layer below my scenery. It looks very realistic! I'm trying to upload a small video clip to YouTube and will notify you once it succeeded.

Hope this helps
Ryno