I have tried 3 custom ROMS for Milestone and they are Cyanogenmod 6, Cronos and G.O.T

Both Cyanogenmod and Cronos Froyo are installed via the Open Recovery Menu from Androidaini
while G.O.T is installed via a software called RSDlite via your Windows PC.

From my experience, newbies would find it easier to install G.O.T

The 2 recommended G.O.T firmware to use are RTUK and RTEU.

I have tested the UK Froyo firmware (RTUK) for my Starhub Motorola Milestone and it is pretty good.
One bonus... it removed that ugly Starhub logo with the original "M" Motorola logo at the start up screen.

For more info on how to install G.O.T please go to http://forum.xda-developers.com/showthread.php?t=811221
The only bug about G.O.T is that Facebook don't sync with your phone contacts.

I've tried Cyanogen 6.1.1 and I have to say I am very impressed. Not bothered to wait for Motorola anymore. Not only does Cyanogen give you 2.2 (well most of it), you get a ton of useful programs, fixes and enhancements as well plus an active dev community improving it. Even if Motorola releases 2.2, I'm sticking with Cyanogen now.

So far these are the improvements I've seen over stock 2.1
1) you get dalvik JIT
2) App2SD (most android market apps install on phone by default but you can move them to SD later)
3) 3G mobile hotspot (useless to me but maybe you guys use it)
4) Huge changes on Gallery - With 2.1 viewing pictures tend to be laggy but the gallery now is very very smooth and in beautiful 3d now.
5) Slightly better looking music player and I really like how when you have music on - the music controls are now available on the locked screen so you can skip, rewind or pause/play without needing to unlock. with 2.1, you had to struggle with unlocking the phone first.
6) Now, if you were on headphones, when you pull out the connectors, music also pauses. In my old 2.1 music would blast through the phone speakers instead and piss off my office mates.
7) Included "clock" app is great, doubles as a dock clock mode, and gives you access to alarm, gallery, music at the same time.
8) Flac support - great for playing flac music without re-encoding to mp3
9) Improved camera options
10) There's also a number of background improvements, like tweaking the governors etc but its mostly invisible so i think you guys wont really need to know

It was surprisingly easy to install cyanogen but keep in mind its still in beta so you might have some bugs here and there. So far I'm testing and I haven't found any major issues yet. Cyanogen comes with ADW launcher so you can adjust the themes but I installed Launcherpro over it cause I always found launcher pro to be smoother.

On top of Cyanogen, I also got root, and overclock to 800ghz during the install process from Andrioani OR.

If i have time later, I'll write up a guide on how to install Cyanogen from first step all the way to end.

Ok folks here is the step by step of how to install Cyanogen. There's two portions - first portion is getting Root, a nandroid backup and Open recovery installed. 2nd portion is actual Cyanogen installation. Remember that there is always a risk with flashing ROMs. You will be proceeding at your own risk and I am not responsible for any issues you may encounter from a custom ROM.

Ok here we go:

Download all files first so that you can perform all the steps in one go.
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Files for root and open recovery installation
1. Download Motorola USB drivers (http://www.motorola.com/Support/US-EN/Support-Homepage/Software_and_Drivers/USB-and-PC-Charging-Drivers)
2. Download RSD Lite 4.6 - I downloaded from (http://and-developers.com/tools:rsd_lite)
3. Download the vulnerable recovery - "vulnerable_recovery_only_RAMDLD90_78" and save to your computer somewhere (http://android.doshaska.net/rootable)
4. Download latest Andrioani OR 3.3.zip (http://code.google.com/p/androidiani-openrecovery/downloads/list) - why Andrioani 3.3? Because its gota lot of handy scripts and radio band scripts built in.

Files for Cyanogen
5. Download latest Cyanogen (http://forum.xda-developers.com/showthread.php?t=784750) the link is usually quite at the bottom. Just search under "download links". Its a zip file.
6. Download Google Apps (http://android.d3xt3r01.tk/cyanogen/gapps/gapps-hdpi-20101114-signed.zip) - to install marketplace, etc. its a zip file. 

Installation of Open Recovery + Root + backup
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1. Install Motorola USB drivers on your PC - do this first, I skipped this at first and had some problems connecting on RSD lite
2. Install RSD Lite 4.6 on your PC
3. Connect your phone to PC using the USB cable, and set to memory card access. Unzip Andrioani 3.3.zip in your phone SD card, you should get 1 folder (OpenRecovery) and 1 file (update.zip).
4. Copy the Cyanogen zip file and the Google Apps zip file into the "your SD card\OpenRecovery\updates" folder. This is for later installation.
5. Now turn off your phone
6. Run RSD lite on your PC
7. Press the Keypad Up + Power button for a few seconds (if this doesnt work, press the keypad X + Power Button) to boot into bootloader mode. If successful, you will see the Bootloader version on top and "battery ok..." msg at middle of screen. X button = square gold button.
8. Now back to your pc and from RSD lite, you should now see your phone connected. In RSD lite, select the vulnerable recovery file and then press start. You will see RSD lite status showing flashing. During this time your phone may reboot, just let it continue and you will see the progress % increase slowly. 
9. Once you see the % hit 100%, the status will tell you to manually boot your phone. Just turn off now, and then do step 6-7 again to go into bootloader mode. Once there, RSD lite status should now show "PASS" - that means you flashed correctly. If you get an error msg at status, close RSD lite, and then start from step 4 again.
10. Ok now turn off your phone again. Now press camera button and then press the power button. Hold then both until you see the recovery screen (takes about 6-7 seconds). It will be small phone symbol with ! logo on top.
11. Once in recovery screen, press both the volume Up button + Camera button together until you see a menu come up. Keep pressing a few times until as it takes a few tries sometimes.
12. The menu will list 4 options, use your phone keypad to go to "apply sdcard:update.zip" and press the X key to select it to install.
13. A screen should appear to show you have now loaded Open Recovery (thats the Andrioani OR).
14. Now your first step is to go and do a backup first. Use your keypad to go down and select "Nandroid". The Menu will now change to "go back, backup, Restore, Delete". Select "Backup" and then select "backup all". This will backup your current phone condition in case you ever want to flash back to 2.1.
15. Once backup is done, go back to main screen and then go to "Root Phone". Select this to root your phone.
Congrats you have now rooted and backup your phone. You can go ahead and install Cyanogen now.

Installing Cyanogen
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1. I always recommend a full reset and wipe first before installing Cyanogen. From the recovery main menu, scroll all the way to bottom and you should see "wipe dalvik cache", "wipe data/fac reset" and "wipe cache partition". Go ahead and run all 3 wipes.
2. Ok now from the Recovery main menu, you should see the an "apply update" option. Select this and it should show the name of the cyanogen zip and google apps zip file.
3. Select the cyanogen zip and apply it. (just hit Yes when it asks to confirm). Let it install until complete.
3. Select the google apps zip and apply it. (just hit Yes when it asks to confirm). Let it install until complete.
4. Reboot your phone.
5. Congrats you should now see the new boot screen for Cyanogen.

For bond0613: Changing the baseband
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My phone was able to run 3g fine without installing any additional baseband files on Cyanogen. It might be a problem with the Telus file you used, Telus is the Canadian baseband so it may be different from Malaysia's baseband usage.
If you have a problem with 3g, repeat all steps to get back into recovery main menu. Andrioani comes with multiple basebands, so you can just select "change baseband" and try installing for a new region (singapore should work).