There is a tutorial (including complete source code) on how to build an Android RSS reder here:
part 2 (application updated to parse image tags from desciption)
part 3 (application update with Android 3.0)
The tutorial uses SAX parser and includes a complete Android project that accesses an RSS feed and then displays the feed in a list view.
There still seems to be a lot of people interested in this - so if you are looking for an Android 3.0+ with fragments/async tasks etc, as well as complete application code, I have updated the posts again, and they can be found here!