Racks are great fun - 3 of my four bikes have one. (or two, on the extracycle).
Forever ago I just zip-tied a milk crate on the back, worked great but didn't like the high COG and the extra weight. I've added Nashbar ATB panniers, cheap but effective, as well as the Nashbar trunk rack posted above. Some days I use all 3, most commute days its just the trunk rack. It holds a change of clothes, lunch, and a few other odds and ends remarkably well.