Remove reference to PySqlite2 since we are recommending Python v2.5 (which includes the 'sqlite3' module in the base distribution).

Also, recommend ActivePython.  While it is a commercially-backed product, "pypm" (like "easy_install" on Linux) makes it an absolute snap to get all the dependencies for Evennia.  It simplifies setup on Windows greatly compared to the stock distribution at www.python.org coupled with the stock "easy_install".)

Also, re-flow some more text.

INSTALL

@@ -7,7 +7,9 @@ Requirements
 ------------
 
 * Python (www.python.org)
-   Version 2.5+ strongly recommended, although 2.3 or 2.4 *may* work just fine.
+   Version 2.5+ strongly recommended, although 2.3 or 2.4 *may* work.
+   + Python is available in all modern operating systems (Linux, Mac, etc.)
+   + ActivePython is recommended for Windows (www.activestate.com/activepython)
 
 * Twisted (http://twistedmatrix.com) 
    Version 10.0+   
@@ -18,21 +20,27 @@ Requirements
    Version 1.2.1+ or latest subversion trunk highly recommended. 
    + PIL library (www.pythonware.com/products/pil)
 
-* PySqlite2 (http://code.google.com/p/pysqlite)
-   Needed if you want to use the sqlite default database. Otherwise you need to 
-   check which databases are supported by Django and install/setup that instead.
-
 * Apache2 (http://httpd.apache.org)
-   Optional. Other equivalent webservers with a Python interpreter module can also
-   be used. Required for serving final production web interface (not needed for   
-   web development, django has a test server that's good enough for that).
+   Optional. Other equivalent webservers with a Python interpreter module can 
+   also be used. Required for serving final production web interface 
+   (not needed for web development, django has a test server that's good 
+   enough for that).
 
 * Subversion (subversion.apache.org) 
    This is needed to download Evennia itself.
 
-Users of most decent Linux distros should be able to install all the above through 
-their normal package managers. Windows users will need to visit the various homepages 
-and install the programs manually. 
+Users of most decent Linux distros should be able to install all the above 
+through their normal package managers, or by using "easy_install"
+(See also http://packages.python.org/distribute/easy_install.html#downloading-and-installing-a-package).
+Example: easy_install django
+ 
+
+Windows users who installed ActivePython can use "pypm" on the Windows 
+command shell (cmd.exe) which is functionally equivalent to the "easy_install"
+method, above.  (See also: http://docs.activestate.com/activepython/2.6/pypm.html#what-is-pypm).
+Example: pypm install django
+
+Windows users who do not have "pypm" (installed with ActivePython) will need to visit the various homepages and install the programs manually. 
 
 
 Installation
@@ -103,12 +111,14 @@ Web features (Optional)
 
   Django's test webserver starts up locally on port 8000. Point your webbrowser 
   to 'localhost:8000' and you should see Evennia's nice default page, 
-  graphics and all (gasp!). You cannot play the game from here, but you can
+  graphics and all). You cannot play the game from here, but you can
   view and edit the database extensively using the powerful admin interface,    
   courtesy of Django. 
 
-  Note: You should never use the django testserver for anything more than local
-  tests. If you have a full-fledged web server (like Apache) running you should use 
-  that for production environments. Set up your apache2.conf to point mod-python 
-  to your newly created settings.py file (see online documentation for details).
+  Note: You should never use the django testserver for anything more than 
+  local tests. If you have a full-fledged web server (like Apache) running
+  you should use that for production environments. 
+
+  Set up your apache2.conf to point mod-python to your newly created 
+  settings.py file (see online documentation for details).