Sharpening and sharpness

I can't over-emphasize the importance of sharpness... it's REALLY important. There are two aspects of sharpening: geometry, and the actual quality of the sharpened edge. Both are equally important, but the first tends to be more frequently overlooked and is more difficult to achieve correctly.
There are three different "correct" styles of plane blade sharpening. I use the simplest style.
A sharp edge on a chisel or a plane is created by two flat surfaces that intersect each other. Planes and chisels have a flat back, and a bevel that intersects the flat back at a specific angle. The cutting edge is the point where the two planes intersect. Ideally, both of these surfaces should be dead flat, and completely smooth and polished.
Style 1: the back is flat, and the top is beveled at 25-30˚ to the back. 25˚ is a finer angle and is for softer wood, 30˚ for harder wood.
Style 2: the back is flat, and the top is beveled at 25˚, then a secondary "micro-bevel" is honed at the very edge, at 30˚-35˚.
Style 3: the back is flat, then a micro-bevel is added, at maybe 10˚ or so. The top is beveled at 25˚, then also micro-beveled. This method only works for planes, and not chisels.

I like the first method, because it is the simplest, and because it gives me the most control over the tool when I am using it. The broad sharpened surface shows me where the edge is, both visually and by feel, so I know how it will cut when I apply it to the wood. Also, every time you sharpen using method #1, you are maintaining the original geometry of the tool, where with the second two methods, you will need to periodically restore the larger surfaces as the micro bevels gradually become larger. Also, this method gives you a finer cutting angle than is possible with the other two methods. However, the other two methods are very useful, especially when planing, or when a steeper cutting angle is desireable in order to prevent wood tearout.

This is the best video I have found on sharpening. The only thing that this guy doesn't quite explain fully, although he demonstrates it totally correctly, is that you have to keep the back of the plane iron DEAD FLAT and not rounded over or beveled in any way. http://www.youtube.com/watch?v=3Hm4HiN2Lww&feature=related

You don't have to use the grinding wheel, ever, unless you put a big nick in the cutting edge and don't want to spend all day using a stone- the wheel does save time and the hollow grind gives you control when you sharpen the bevel. He skips from a coarse stone to fine honing compound, but this works fine, it just takes more work, especially as the hollow bevel created by the grinding wheel becomes more flat after repeated sharpenings on the stone. The medium grit stones are intermediary and can save some time if you don't want to polish out the scratches left by a coarser stone using a fine polishing medium- the same idea as sanding wood, to progressively finer grits, where each level of sanding removes the scratches left by the previous sanding, replacing them with finer scratches. Imagine the surface of the metal at a microscopic level. You want it to be smooth, and not rough, or having ridges, or scratches left in it. No matter how close you "zoom in", the quality of the surfaces and of the sharpened edge should remain the same, until you reach the actual molecules, ideally.

Once you understand how to sharpen planes and chisels, sharpening everything else is pretty much self-explanatory. Use the stone, strop, diamond cone, grinding wheel, or whatever thing you are using, to restore the geometry of whatever tool you are sharpening, keep the angles consistent, and polish the surfaces.