In 1990, I read a great little book called The Physics of Baseball by Robin K. Adair (now in its third edition). It's strongly recommended to anyone interested in the subject matter. And here's a short Q&A with Adair at Popular Mechanics from a couple of years ago.
But a few other items of note on this subject have popped up recently.
First, a great chart at The Book, with the speed of the ball off the bat as the X axis and the angle of launch as Y, showing the outcome (from ground ball to home run) at the points X,Y.
Then, there's an article in the latest issue of the American Journal of Physics by Faber, Smith, Nathan, and Russell called "Corked bats, juiced balls, and humidors: The physics of cheating". You can also find a short summary of the article at Smithsonian.com.
There are three questions asked, each with a nuanced answer.
1. Question: "Can a baseball be hit farther with a corked bat?"
Answer: "... while corking may not allow a batter to hit the ball farther, it may well allow a batter to hit the ball solidly more often."
2. Question: "Is the baseball juiced?"
Answer: The researchers "found no evidence that baseballs of today are more or less lively than baseballs used in the late 1970s."
3. Question: "What's the deal with the humidor?" (Or, "is it plausible that the humidor accounts for the decrease in offensive statistics at Coors Field since 2002?"
For those interested in a deeper dive into this topic, one of the co-authors of the study, Alan Nathan, has a page dedicated to the physics of baseball.
Update 2011-07-13: Tango at The Book posted a link to the Smithsonian article, and there has been plenty of commentary including a number of responses from Alan Nathan.