The Meggy Jr RGB from Evil Mad Science running MeggySeq, driving a Wave Shield from Lady Ada. MeggySeq is a pattern-based drum machine sequencer. It has 8 patterns of 16 steps each and each step can play one of 8 samples (the colors are hard to tell apart on the video). Next steps: Saving patterns to the eeprom, sending MIDI (currently it just sends single characters over serial to the WaveShield) and possibly syncing to external clock sources. Or, you know, changing the tempo at all.
Agh – such coolness! No sign of source code as of yet, but the setup apparently uses another Arduino along with the aforementioned WaveShield. In the Maker Shed: Meggy Jr. RGB Kit Arduino WaveShield Kit