Well, LFS still keeps going, but I think it has one problem, little innovation.
With LFS 7 they finally want to provide a 64-bit version, which is great (btw. there already is a 64-bit LFS Live-CD which can be used to build a 64-bit LFS).
But that's pretty much it, aside from the perpetual upgrading of packages to the latest version.
A distro based on LFS which is under active, but slow development is my
EasyLFS. The latest version (0.4) is getting a bit old (it's been over a year I think) but the version I'm working on right now (as said, it's progressing slowly, mainly because I work on it by myself and test-compiles test a couple of hours) will have a lot of improvements over 0.4.
With EasyLFS I don't simply follow the LFS-book, over time quite a few differences have come together, and I also offer some more stuff than LFS, including some advanced stuff like SELinux.