I have been asked to post this while I was in the process of trying to modify WPMU to work like this. As in having a wordpress MU setup where people can add additional domain names that point to their blog, for example, having both praseodymium.example.com and praseodymium.com point to the same blog.
I had the idea of making a site alias table that stores the extra URLs for each blog and the ID number of the blog in the wp_blogs table.
My thinking was that I could use this to get it to point these domain names to the correct blog by modifying whatever method it currently uses to make a blog like praseodymium.example.com to the right place. then using the pre_option_siteurl and pre_option_home hooks as well as any others I need to use to make the blog then work correctly regardless of what URL is used.
Is this idea I have the right way of doing this?