The new Pathfinder RPG rules raise the challenge. The point is to write a set of house rules that is as small as possible while fixing the (few) problems with D&D 3.5 as written.
Skills: No cross-class penalty. Apply INT bonus retroactively. (Makes it easier to figure out what your skill rank total ought to be.)
Multi-classing: No XP penalty for multi-classing. (No getting extra screwed for playing an elven druid who switches to cleric.)
Grappling: Win opposed grapple check to do damage, move, or silence your opponent or to get out of the grapple. No other action is possible while grappling. (Grappling is easy, but all the little extras make it confusing.)
Iterative Attacks: When you get a 2nd attack, your attacks have a penalty of -2/-2 (instead of 0/-5). Instead of getting a third attack, the penalty drops to -1/-1 (instead of 0/-5/-10). Instead of getting a fourth attack, the penalty drops to -0/-0 (instead of 0/-5/-10/-20).   
Attacks of Opportunity: Attacks of opportunity may not use particular combat maneuvers like disarming, tripping, or sundering. (Gets rid of the terrible “umbrella of protection” – enlarged spiked chain wielding characters with Improved Trip.)
Feats: Dodge provides +1 dodge bonus to AC against all opponents. (People keep forgetting Dodge.)
Flight: Forget about the movement details. (Too complicated.)
XP: Use more story awards, award less XP for combat. Essentially I will provide points worth 300 XP for things done. Characters below average party level get 20% bonus, characters above average party level get 20% penalty. Followers will receive half a share and no bonus. Fighting is worth the challenge rating of a monster in points. Multiply or divide by two for every difference of two between average party level and challenge rating. (Get rid of the CR/XP tables.)
Scrolls: Once scribed, there is no longer a distinction between arcane and divine spells. If it is on your spell list, you can cast it.
Duration: Spells lasting a few rounds last for a single encounter. They never run out during a fight. This includes summoned creatures and similar effects. Spells lasting a few hours last for a single day. (Get rid of tracking time.)
Spellcasters: No limit on the number of zero level spells per day. No need to memorize them, and no need to keep track of them. There is no shortage of Light, Acid Splash, Cure Minor Wounds, Message, Prestidigitation, Detect Magic, etc. (Get rid of healing items, provide an alternative attack for wizards that have run out of spells.)
Hitpoints: At the end of the encounter you may take half an hour to catch your breath and you’re back at full hit-points. (Gets rid of the need to bring a cleric along.)
Magic Items: No XP cost. The fancy raw materials required might require quests, however.
Action Points: There will be no action points. (A list of action problems is available from Delta.)
Shields break: If you’re carrying a shield, you can have it shatter instead of suffering damage from an attack. (Shields Shall be Splintered unless you’re surprised.)
Confusion: Roll 1d4: 1 – act normally, 2 – do nothing but babble incoherently, 3 – deal 1d8 points of damage + Str bonus to self with item in hand, 4 – attack nearest creature. 
d30: Once per session you can use a d30 instead of a d20.
Character Generation: Players can roll for abilities using 4d6 and dropping the lowest die, or use a 25 point buy. Supposedly rolling the dice results in the equivalent of a 30-31 point buy. On average.
Hit Points: Players can roll for hit-points or use fixed values (DMG p. 198): 0.5 hp below average the first time you do this, then alternate between 0.5 hp above average and 0.5 below average.
Character Death in an Adventure Path: You start at the beginning of the previous level. If your level 4 character dies, you create a new level 3 character with 3000 XP. (“Under most circumstances, a new character should begin play at the beginning of the level lower than the player’s previous PC.” – DMG p. 42)
Character Death in a Sandbox: New characters start on first level. Alternatively, players may choose to play an NPC who has reasonable cause to join the party. (Encourage friendships and experiment with a wide variety of levels.)
Character Resurrection: Death and resurrection is part of the game. You start at the previous level with enough XP to get you half way back to the current one. If your level 4 character dies, you create a new level 3 character with 4500 XP. (“The character’s new XP total is midway between the minimum needed for his or her new level and the minimum needed for the next one.” – DMG p. 42)
New Players: You start at the same level as the lowest regular player character. If the party has player characters ranging from level 3 to 6, new players create a new level 3 character with 3000 XP. (“A new player should create his first character at the beginning of the level where the lowest-level existing PC is.” – DMG p. 42)
New Character: Use the same rule as for character death.
Absent Players: Absent players ⇒ absent characters, no questions asked.
Long Absence: Use the same rule as for new players, ie. “start at the same level as the lowest regular player character.”
Charisma: There is no Leadership feat. Instead, players build an entourage using roleplay within the limits of their Charisma score. One of their entourage will be a Loyal Follower and a potential replacement character. (Inspired by David Bowman’s Entourage Approach.)
Charisma determines the number of your followers, their morale score, and monster reactions. I like the simplicity of the tables in Labyrinth Lord.
|Charisma||Reaction Adjustment||Retainers||Retainer Morale|
Morale check: Retainers only make a morale check when an unusal amount of danger is involved. Monsters make morale checks when suffering their first casualty and when things start looking grim. If the roll of 2d6 fails and the result is higher than the morale score, the retainer or monster will retreat or flee (depending on Alignment and Intelligence).
Monsters usually make a morale check when their group looses its first member and when half the group is killed or otherwise incapacitated.
Reaction rolls: Apply the modifiers from the Charisma table above.
These rules will not apply when we’re playing in a published adventure path:
Name Level: Characters reach reaching level 9 must build a stronghold or be ready to retire their character when they reach level 10. (Ordinary adventures will take place in the level range from one to nine; higher level adventures may involve mass battles.)
Slow Advancement: In order to enjoy more play between before reaching name level, we use a different advancement table.
Land: Based on some numbers I got from Rob Conley here’s what to expect when building a stronghold: