I like seeing the past and present merge by using layers of both historic and present day maps on Google Earth, but morphing photographs is even better.
The Ghosts of World War II's Past on My Modern Met showcases scenes from World War Two merged with the same location today. Buildings scarred and cratered from bombings are seen as pale foundations for new construction; pitted roads and armed blockades appear in contrast to a calm country village landscape.
This kind of photo blending has also led to the Looking Into the Past flickr group. Some images show an enlarged photo held up for a present-day photograph; others are obvious photo editing projects. Several include tips and ideas for making your own morphed photos.
There's even a new iPhone app from the Museum of London called Streetmuseum that makes historic art and photo images available to users. Find an image on your iPhone, hold up the phone and snap a present-day photo for a "window through time." A few years ago we toured London and tried to imagine past events and places; it would have been so much better with on-site acess to historic images. I hope more cities add this kind of interactive tourist guide.
For now, I would like to take some of our old house photos and create a similar image; imagine the "new" creations, and even "revised" history we could write!