What really makes the event is the people that go there.  Everyone comes ready to be a bit wild, positive and creative in what they wear, how they interact with one another, etc.  There are always a few bad apples, but remarkably few of them (to the extent that people get perhaps a bit too trusting).  The overwhelming majority are always ready to help, to make your day a bit more fun and a bit more random.

Typical non-Burner question: "Burning Man.  Isn't that the place with all those naked people?" Sigh.  That's not the point.  Get this, punks: you can wear, or not wear whatever you like.  And everyone's cool with it.  That's the point.

Either the demographics that head out to the Playa or the act of daring to be more like your true self (probably both) makes many people at Burning Man somehow stunningly beautiful.  I've heard this from many who go there, it's not (just) me being a lech.

(Click on the thumbnails for a larger image.)
 
The place to peoplewatch is Center Camp, an enormous shaded area (and the one place where you can use money, to buy something to drink at the cafe).  There is a lot of clowning about, there are performance stages all around so anyone can be a star, and

Capoeira in Center Camp.  It's a Brazilian dance/martial art, very acrobatic and done two at a time in a circle of spectators.  The moves are done to the tempo of the drums and other instruments.  Archangel practices it (he's been to Brazil with his group, lucky bastard).
  Part of a troupe doing all manner of hilarious routines.  The balloon had a single nozzle which an assistant used to refill it with air from time to time (the balloon would shrink over time).  It sealed itself when not in use, but was actually big enough to stretch and struggle and squeeze in through (as a second dancer did at one point).  This looked amazing until with a loud POP the fun was over.  They were both a bit dazed after that.  
  Ever see Baraka?  Someone was leading a chant much like the one in that film using recruits from within Center Camp.  
Center Camp, at night.  A whole flock of these guys showed up.  It's this sort of creative dress and action, all happening a hundred ways all around you, that makes for the happy chaos that is Burning Man.
  Yes, he was on the way to Center Camp too.  
  These two weren't going anywhere fast, but they were fun to watch.  The horse was one of the sculptures out in the desert.  
After a few days in the desert, you really, really want a bath.  And there are these trucks that drive about watering down the roads (such as they are) to keep the dust down.   Combining these thoughts...  Every so often a cry of 'water truck!' rings out, and people come running out, strip naked, and run behind it to get doused.
'Talk to God' says the sign.  'God' was across the street, on a throne.  You could ask him questions and passers-by could hear the amplified, amusing conversation.  I took this shot when a guy dressed like a Technicolor pope was asking for advice...  
  Yoga class, one of many (a few years ago I remember an 'Elvis yoga' class).  There are all sorts of little classes and workshops going on at Burning Man, and the people teaching them are often surprisingly talented.  
  I did mention there are a lot of beautiful people out there.  I think it's the freedom to be more daringly creative and expressive in what you wear.  Or don't wear.  These shots don't show even a fraction of that, but I don't usually like to take pictures of people just because they look good.  
  At my camp, I teach a popular introduction to rope bondage.  Hard to explain, but this sort of self exploration class fits into the Burning Man vibe very well.  I keep a very positive, practical approach to the classes and everyone has a good time.  No, it doesn't suck that I get to tie up some very interesting and attractive people.  
Another example of the dangers of using a flash to take night shots.  This guy was wearing big, spring-loaded stilts with claw feet on them (check out the undecorated version, now available pretty cheaply as Powerisers).  So the effect was of a monster taking huge strides across the desert .