Not got a ton to add to this thread, but just wanted to add that I'm glad I read that advice. Planning to do an ALR myself in 2011 (no idea when yet as I'm waiting for birthday and Christmas money to do it

), so the advice regarding seat reservations on the Cally sleeper is most welcome. So thanks!
Will have a read of the rest of this thread, then edit this post if I've anything useful to add.
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An ALR is a complete rip-off. £990 for a 14-day first class ticket? You can get a 15-day first-class pass for Swiss railways for less than half that amount (£425) - and swiss railways are truly luxurious, with stunning scenery on every single line. Don't waste your money - book a cheap flight to Zurich, get a Swiss rail pass and spend the other £550 on budget lodgings once you're there.
A good point to remember is that Switzerland is a tiny country compared to the UK. Fares reflect this.
As for whether a UK ALR is a rip-off or not is subjective. If, for example, you wanted to use one to get around the country without restrictions and cover routes you still haven't done, whilst also having the flexibility to change plans at the drop of a hat for whatever reason, then it's a very good value ticket.
My planned ALR in 2011 (my first at that) is being bought for covering routes I still haven't done. Yes with some careful planning and buying Advance fares months before intended travel, it may well work out to be cheaper. But that doesn't come with the same level of delight at holding *the* most flexible ticket for travel in the UK in your hands, knowing you've got a whole week/fortnight to go where you please, when you please. I know I'd like that as I've done it twice with a mate's ALR. It was incredibly hard to let him have it back!

Not that I used it at all mind, just staring at his ALR in my hands was enough. I knew when he did his one in March I just have to do one! In August I made firm plans to do one at the first opportunity in 2011.
An ALR comes with incredible freedom for haulage enthusiasts like myself too. No combination of Advance fares/walk-up returns/whatever will ever give me the same freedom to choose what train I want to get on. So in that respect it's also incredibly good value. Granted, in that respect, if the UK motive power scene doesn't interest you then an ALR is a rip-off, and the Swiss pass is a better deal. As I say, it's all subjective.
Suggestions for the OP's ALR in December 2010, well difficult to say really. He wishes to travel on scenic lines and interesting traction. Difficult to know what to suggest in traction terms, but there's still a fair bit to choose from. Should he wish to travel on electric locomotive-hauled trains, the ECML and GEML are the best bet, as well as that Fridays Only run from Euston to Preston. Diesel loco wise, it's still restrictive but WSMR, ATW's WAG-Ex and the current FGW/FSR loco hauled stuff, as well as the Night Riviera and Cally sleeper north of Edinburgh, should provide a fair bit of choice.
Where to go? I think most things have been suggested already to be honest, although I highly recommend a run from Paddington to Penzance. Most of the scenic stuff kicks in after Plymouth it seems, so the sleeper would be running in daylight for much of the Cornish section of the run. Getting an HST back to London after would, of course, mean you see all of the delights back to Exeter (north of which is rather meh). The West Highland Line is also a definite. Suggested it to the same mate of mine who did his last ALR in March, as he'd never been up there. He got the sleeper up to Fort William and loved it, as I reckoned would be the case.
You'd be in darkness on the northbound run, but doing the Highland Chieftain throughout from Inverness to Kings Cross would take you through some stunning scenery in daylight. If it's been snowing, far better.
The WCML north of Lancaster is really stunning too, highly recommended. A trip down the Heart of Wales line is also highly recommended, some stunning scenery, best enjoyed on a nice day. Hard to come by in December of course, but still worth doing. I always enjoy a trip up or down that line. Slow, and means settling for a 153 most of the year, but as I say if you've not done it then it's well worth the effort.
A trip through the Golden Valley (between Gloucester and Swindon via Stroud) is quite nice too, although I forget what it's like in December. At the right time of year, it's pretty scenic in places. Might be worth a shot, and it wouldn't take too long to do anyway.
Another thought is one that sticks in mind from someone's advice on another forum years ago, which is to not rely on places like Burger King for meals, as it's all empty calories and won't fill you up for long, meaning you'll end up spending more money.
Finally, enjoy the experience. Do let us know how it went!