Here is a link to the power point presentation I am getting all of this from:

http://www.bungie.net/images/Inside/publications/presentations/gdc2008_butcher_chris_matchmaking.ppt

This is from GDC '08.  I will be picking and choosing the more interesting tidbits.

There are some interesting things in the presentation.  Gives a good overview of what it is, how it works, and what works about it.  The last two slides I linked to are particularly telling for what Reach's system will entail. 

Reach will probably have goals to reach instead of/in addition to ranks.

Rewards will be given for reaching said goals.

They feel they have solved the majority of the issues from Halo2/3 and Reach should have an even better matchmaking system.

And the last line is particularly interesting.  "Peer-to-peer is the future"

I think we should expect an incredibly tuned system for Reach.  I cannot wait.

Thats some good stuff!

great stuff, but its hard to think of halo having dedicated servers, would be wierd.

dam these are huge improvements from halo 3 multiplayer, atlast my frustration would decrease when playing halo.