The Scottish scientists did not create a new adult clone of an existing sheep. Things were done the old-fashioned way. They chose a surrogate mother and let the fertilized egg grow inside the mother's womb. There is only one crucial difference between what they did and what many childless human couples do. There was no sperm involved in the creation of Dolly. Instead, normal tissue from the mother alone was used to create the egg.
In what way is this revolutionary? To sucessfully use the tissue of a fully grown mammal to create a baby, the biological development of those tissue cells has to be reversed. This is something that most scientists thought impossible until Ian Wilmut and his colleagues proved it could be done.
Neither the mechanism by which the tissue cells "de-aged" nor the way the cells specialized (i.e. became heart cells, liver cells etc.) is understood. In fact, Dolly was the only successful case among 277 attempts . Many of the other "clones" had all kinds of genetic deficiencies. A lot of work needs to be done to understand the biological processes involved and to make the whole technology reasonably controllable.
One of the bogus claims advanced by the popular press is that if cloning catches on, there will be no genetic variations. Genetic variation in populations arises from two sources -- crossover (which cloning will put an end to) and mutations (which will continue to exist). In fact, with the current state of the technology, there are a lot more mutations than is normal.
There is one thing though, that the arm-waving columnists seem to have missed. You don't need sperm or sperm banks to create babies using cloning. If cloning catches on, homo sapiens can become a species of hermaphrodites, killing off all the men. After all, who needs us? Now, that is worth talking about.