For my money, there is no doubt that Autostitch yields the best results out there. The base version is free for down load at the developers website.
The short write up in Wikipedia says "The software uses the SIFT- and the RANSAC-Algorithm. This program differs from others such as photostitch in that it automatically stitches together even unaligned or zoomed photographs seamlessly without user input, whereas others often require the user to highlight matching areas for the photographs to merge properly. The only requirement is that all photographs be taken from a single point."
If the currently offered demo is the same as I downloaded sometime ago, it is fully functional, but very short on documentation of the obscure parameters. The best way to try it is to chuck a shoebox of photos at it and go form there.
The developers web site contains plenty of examples of how the program works through the process.
It has been licensed to some commercial vendors who have wrapped in a better interface, and added features.