According to Wired News (And Scoble) there is still an ISP working in New Orleans. "It's an advantage they (the ISP company, DirectNIC) are quick to put to use. DirectNIC's "crisis manager," Michael "Interdictor" Barnett, updates his Live Journal continually with on-the-street reports."
According to Wired News "It may be the only blog currently both written and hosted inside New Orleans, and it's receiving nearly 3,000 visitors an hour." Check it out.