The 1.0.0 release is actually formerly known as the 0.20.205.1 release -- ie just bugfixes since 0.20.205.
Hadoop's been "production ready" for years - there are hundreds of companies running it in business critical applications. But some people want to see "1.0" before they move to production :) So we recently decided to call it 1.0 so that the version numbering matches the maturity Hadoop has already achieved.
-Todd (Hadoop PMC)