I've been caving, it's so easy. I just dig straight down 'til I hit the bedrock, then travel sideways. Haven't found diamonds or obsidian yet, but plenty of steel. I just take abunch of torches with me and place one every ten - twenty blocks to stop monsters appearing behind me.
On a multiplayer server (craft.minestick.com, it's a good one you should try it) I have a cave with an obsidian floor, and I'm making lava waterfalls around the side for lighting. You can't take damage, though, which makes it too easy, but hopefully hitpoints will function properly soon and when they do Minestick is going to be a Hard Mode server. I need to make my cave all nice and safe for when that happens =) .
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