Set Stack Icon
Important Note
As of Mac OS X v10.5.2, this is no longer necessary. Simply right-click (or Ctrl-click) on a stack in the Dock and choose "Display as: Folder".
Background
Mac OS X "Leopard" changes the display of a folder in the Dock from previous versions of the operating system. Rather than displaying the folder's icon, it takes a few icons from inside the folder and overlays them, which is supposed to give the impression of a "stack" of items. Originally, Leopard was going to allow the user to select a group of files in the Finder and drag them to the Dock (at least, that's what Apple's preview site claimed), creating stacks on-the-fly. By the time the final version shipped, however, the "stacks" feature was reduced to merely a different display style for docked folders.
The problem with the new display style is that the icon doesn't really resemble a stack at all. Instead, the first app found inside the folder is prominently visible, with some visual noise around it. For the Applications folder, this results in the icon looking like it will open the Address Book, unless you have it sorted by, say, Date Added, in which case (in a new installation) the Utilities folder icon will be shown. If a 3D stack had actually been created for the items, possibly with a badge of some sort, the concept might have worked, but as it stands it just makes things confusing.
One workaround for the problem is to create a file inside the folder with a name that sorts above the others, and then assign the folder's icon to that file. This is an Automator action that does just that. It takes the selected folder, creates a file inside it called " • Stack Icon", and assigns the folder's icon to the file. (The leading space in the filename is what pushes the file to the top of the stack; the sort order is apparently different from that of Finder windows.)
Instructions
Download the workflow, unzip, and place in your Library/Workflows/Applications/Finder folder (you may need to create some of the intermediate folders if they don't already exist). You can then right-click on a folder and choose More > Automator > Set Stack Icon.