The Liverpool Echo has a cool experiment on its web site that's worth a look. Although there are several big papers in the US with advanced projects along these lines, this one of the first efforts by a daily UK newspaper at mapping news stories to help readers easily identify the ones that are most geographically pertinent to them. It's very slow to load, but does see to work.
I've done a small amount of work myself on geomapping projects (My Album Covers Atlas - a crowdsourcing experiment for Word Magazine - is now heading towards 600 entries sourced by readers) so I know some of the difficulties. I'll be talking to the Echo team about how they've gone about trying to solve the trickier ones and how they've tied it in to their existing content management system.