We are technically separate from USDS, but we're in close cooperation and constant communication with regard to overall strategy, hiring, technical and cultural techniques, and seriously watch out for those guys at Board Game Night. Basically we're BFFs.
I understand your skepticism - I left Federal contracting years ago in disgust at the way things have been working, or not working.
But 18F convinced me that they have the key to change that - completely with regard to their own work, and then with a wider ripple effect. That's something I couldn't pass up; I turned down a dream job in the private sector for 18F. Six months later, I'm more convinced and excited than ever.
It's important that 18F is a brand-new organization with great autonomy. This is not an effort to make an existing Federal agency "get" open/agile. That would be noble but very difficult. Rather, 18F is built from the ground up entirely of people with real devotion to and real experience in the principles. That especially includes the people at the top (to the extent we even have a top, it's really quite flat in here). And 18F overall has the leverage to do our work our way, because many other groups within the government believe that we can and will deliver (and are delivering) effectively... there's more work lined up for us than we can possibly fulfill (even if you all DO join us). We can say "no" when we're asked to work with conditions that would change us into what we're trying to fix.
All that said, we are a bunch of idealists, too. Has our optimism run away with us? Well, we'll certainly deliver excellent product. Time will tell how far the ripple effect will go.
Well, there is Code for America. That's a volunteer organization not actually within the government, so it's not a terribly close analogy, but it's still one means of digital civic service that stops short of full-time.