This is a handy little widget that will pull a list of all the sites in your network and order them by last updated. The code for this was originally in the home theme of the WPMU download, so thanks to Donncha for that bit.
I tested it in the mu-plugins folder, but you should also be able to use it as a regular plugin as it only needs to run on one blog. It’s also the older widget code, so you can only use it once, not multiple times, and it has no options. Short, sweet & simple.