"We need to teach knowledge or content in context with the tasks and activities the students are undertaking. Our students respond well to real world problems. Our delivery of knowledge should scaffold the learning process and provide a foundation for activities. As we know from the learning pyramid content delivered without context or other activity has a low retention rate."
Martin Dougiamas, lead director and founder of Moodle has shared a superb presentation on where Moodle is heading with the release of 2.0 (and looking further forward to 2.1). You can find it here on slide share.