I particularly like that it reflects recent activity. We had a very cool tag cloud when i was working with http://pokerblog.com … as it factored in not only the number of posts, but the recency of the posts when displaying the top several tags on the front page. (this was done in drupal — and there are few tags on the front page now because the blog has gone dormant.)
No plugin that I know of; probably custom. The WordPress.com staff tend to be pretty closemouthed about stuff behind the scenes and none of the forum volunteers would be able to help you with that question. You could email staff directly and ask, though.
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