I use Chamois Butt'r, and it's great stuff. It is a little gooey when you first put it on (and I smear it all over me and the chamois), but it warms up and then everything gets comfy! It seems to make a big difference on long rides.

My favorite shorts? PI Ultrasensors. I tried Terry, but I thought the chamois was too thick, and cheap shorts just don't hold up.