I haven't read it myself, but http://www.amazon.com/Agile-Estimating-Planning-Mike-Cohn/dp... looks a good description of the story points/relative estimation techniques. They're really not something that should require a whole book to explain, but I can't say I've found any one blog post or article-length writeup that does a good job at it. The summary at http://epf.eclipse.org/wikis/openup/core.mgmt.common.extend_... is pretty good (though I'd ignore the bottom section on "Estimation of Effort"), and the wikipedia article on Planning Poker http://en.wikipedia.org/wiki/Planning_poker is a decent writeup as well.

It's unfortunate that so much of the literature on relative estimation/story points/velocity/planning poker ends up intertwined in agile-development-consultantese, so sometimes reading some of these things, you have to take it with a serious grain of salt and weed out all the BS and dogma to get to the useful and important bits. The important bits there are really pretty simple:
* Estimate in terms of points, not days, and estimate tasks relative to one another
* Use planning poker (or something like it) within the team to get more accurate estimates
* Empirically measure how many points you do in a given period of time to come up with your "velocity". To do that, you have to be pretty honest about things being "done done" before you move on to the next task; otherwise it's too easy to fudge and your numbers are worthless. "Oh, yeah, we did 10 points of work, well, except for writing the tests or doing the styling . . ."

Remember that velocity is NOT a productivity measure, it'll change over time, and it'll change if the team members change or if other external factors intervene, like an increase in support requests or something. So this technique kind of only works if your organization isn't already dysfunctional: as soon as velocity is seen as a productivity measurement, you're pretty screwed.

That's pretty much it. The relative estimates let you prioritize work appropriately (i.e. "I'd rather have these five 1-point stories than this one 5-point story, so we'll do those first"), and the velocity lets you track how fast you're actually going and about when you'll be done with a given chunk of work, so you can adjust plans as needed.

Note that relative estimation doesn't work nearly so well for large-scale estimation, or for greenfield development where you don't know what you're doing yet. For large-scale planning, my company will generally just give a SWAG in terms of points (we think this feature is 100 points) to give us at least some initial idea of expected relative sizes of things, then we'll compare that initial SWAG to the actual points as we break things out into more bite-sized stories that we can estimate more accurately. If we feel like we're half way through the feature and we've already done 70 points of work, that's a signal that we need to up our estimate for the remainder of the work. Steve McConnell's book is good as well, though honestly we don't really do much in the way of confidence-based estimates at this point. My experience is that out of every 10 projects we do, 8 or 9 will be within 20% of our initial SWAG and 1 or 2 will blow out to 2 or 3x the initial estimate. Of course, we never know which ones will blow out, we just know something will. In other words, we don't bother with confidence intervals at the individual feature level, we just do it at the macro level. So if a team has a velocity of 10 and we have 26 weeks to deliver a release, giving us a hypothetical total capacity of 260 points, we'll "commit" to maybe 2/3 of that. So we say "Okay, this first 170 points we're pretty sure we can get done. Anything after that will be a bonus."