In short, you can now do:
>>> import nova.version
>>> nova.version.canonical_version_string()
'2011.1'
>>> nova.version.version_string()
'2011.1-dev'
>>> nova.version.version_string_with_vcs()
u'2011.1-newlog2:soren@linux2go.dk-20110107130049-g2cbri7t80vsg2h1'
It's also consumed by the docs and setup.py, so this ought to be the canonical place for updating version information from now on.