Check out: http://www.pilom.com/BicycleElectron...moCircuits.htm for a range of circuits for dynamos.
No, in general there is no drop in replacement for the typical 3w halogen bulb/reflector setup, but you can get a single led and optic for around 10$ which will be as good or better than the original, or you can go silly and build super bright multi LED lights.
I just built a 5w triple LED setup that gives the equivalent light of a 15-20w halogen.