I'm not sure about the IDE, but I'm using ActionScript 2 under Flash 7/8
(7 at home, 8 at work. I'll upgrade to 8 at home soon).
I have a the latest version of Flash with ActionScript 3, but so far I don't have a computer up to spec to run it.
Also, I'm going to have to stick to Flash 8 for the time being, as the places where I'll be teaching game programming in AS both have Flash 8.
I'm already working on a tank game and I have a brilliant "futuristic thrill sport" game in the pipe-line, but I'l elaborate on these in the correct forums.
Hopefully with AS being a proprietry language, I won't murder it like I did with JS.