The directory was always images. As for other changes I don't know of any listing of all the changes (you could of course browse through the changelogs). I've ported a number of apps over from 1.1.x to 1.2.x and not run into any significant changes. There were a few things marked deprecated that I ran into like start_form_tag/end_form_tag, but those were easy to clean up and didn't break anything.
1.2.2 had an issue with functional tests needing strings instead of symbols for the session hash, but 1.2.3 fixed that.
