subblue (Tom Beddard) just ported over the Mathmap v10 Droste Effect filter to Adobe's Pixel Bender Toolkit (see also subblue's flickr page). The filters can be used in After Effects and Photoshop CS4 (and in some cases Flash 10):
"The real creative possibilities open up with After Effects when animating the parameters with a video input! You can download the script here where there are also installation instructions and a quick start guide."
As noted earlier, there are animations available (not from AE) at Leiden University's Escher and the Droste effect; see the frames below from an animation from A logarithmic image transformation by Jos Leys.