YellowTab's Zeta has reached Beta 3, and is on testers hands as you read this. According to Bernd, later this week a new beta will be ready.
This version has many fixes and improvements over the previous version. I talked to a couple of beta testers and so far their opinion is very good. None have complains concerning stability and according to a beta tester's own words "the tracker is incredible".
Not concerning the OS specifically, but it will come with it, Bernd has also been working on FreeCIV and FreeCNC and both are looking great. FreeCNC in particular, working perfectly in full screen with sound support. I'm sure you remember the news piece about BeBochs and Windows 98 booting in 71 secs, well now it boots in a mere 49 secs.. quite impressive.
Zeta is shaping up quite nicely and i for one am looking forward to it. The BeOS Journal will bring you a review soon, so stay tuned.