Sean's got rid of it for now; I imagine if you look in the 'site improvement suggestions' thread it'll say why. I would look, but I'm at work and quite frankly can't be arsed.
I imagine it is only a temporary measure however until the new site layout is up.
Everytime a seach is made it locks up the database for everybody else. So with even a few people searching at any one time the site freezes up for everybody else.
I'm not sure if the live search will ever make a return I'm afraid.