If you are new to making photo books, it can be really intimidating with so many choices of software and places to print your books. I use iPhoto, Blurb and Shutterfly for most of my projects and you'll find that they all use very similar steps to create a photo book or card.
If you have a MAC, iPhoto is excellent and comes installed on your machine. Once you have a large library of photos, you should probably invest $80 in Aperture, the professional strength option.
I think that Blurb is a fabulous, versatile program that it good for both the novice who wants to use simple templates and the pro who wants to design their books totally free-form. You can use it on Macs or PCs.
I think Shutterfly provides the best quality product of all the on-line photo sites for creating books, cards and other gifts. It has recently purchased MyPublisher which seems very similar to Blurb.
- Walgreens and most drug stores offer instant gratification with their products available for in-store pick up within a hour. Great for those last minute birthday presents, but the quality is somewhat lower and they have limited options for their book covers.
Other Resources:
PhotoBookGirl has excellent detailed reviews on most of the photo companies. She also does a great side by side comparisons such as this one for Blurb vs Shutterfly. She is quite PC centric, so don't expect much information on iPhoto or Aperture.