Now in CVS:
Gradient editing on canvas is now available, much more convenient and powerful than the old way of dragging gradient knots in the Fill&Stroke dialog.
o Any number of selected objects can simultaneously display handles and direction lines for their linear and radial gradients (in the objects' fills or strokes). You can drag these handles directly in the drawing, to interactively adjust gradient positions.
o Gradient handles can be enabled in the Node tool, shape tools, Text tool, and Dropper tool (on by default), as well as in Selector and Zoom tools (off by default). Use the Inkscape Preferences dialog to change this.
o Any gradient handle, if dragged close to a handle of another gradient, will merge with that handle (drag with Shift to prevent merging). Dragging such a merged handle will adjust any number of gradients attached to it. To separate merged handles, drag them away one by one with Shift.
o Radial gradients display handles in the center and at the ends of two radii, which allows you to move, rotate, squeeze, or stretch the gradient to form an arbitrary ellipse. Also, you can independently adjust the focus of the gradient; drag the central handle with Shift to separate the focus handle.
o When dragged, handles will snap to the edges and the central axes of the bounding boxes of all selected objects (drag with Shift to prevent snapping).
o Dragging with Ctrl will snap the angle of the linear or radial gradient to the user-settable angle increments (default is 15 degrees). The center of a radial gradient, dragged with Ctrl, will be constrained to horizontal and vertical movement relative to its previous position. When dragged with Ctrl+Alt, a handle moves along the gradient direction or its perpendiculars, allowing you e.g. to stretch or squeeze a linear gradient without disturbing its angle.
Overall, this is a major usability milestone, something I dreamed to do since Sodipodi times. Gradients are one of the most widely used features in Inkscape, and now they are finally made usable (well, almost - see below).
The old gradient position widget in Fill&stroke remains for now (and still works), but I plan to remove it as soon as the new on-canvas editing is sufficiently tested. I would welcome any feedback on the new feature.
Next in my plans: A Gradient tool, which will allow you to actually create new gradients by dragging (at the moment you still need to open Fill&stroke to switch an object to gradient) as well as adjust most gradient settings in its controls bar at the top of the window. In that tool, the selected gradient handle will be moveable by arrow keys (with all the usual modifiers), and setting any color via Fill&stroke, palette, dropper, or Paste style will be applied to the selected handle's gradient stop (instead of the entire selected object).