Wasn't there a case not long ago where option holders got basically raped by the taxman? They were taxed on their options as if they'd been exercised at their peak value, but by the time they vested they were worth a lot less.
The situation where you can (could?) get screwed by AMT is if you exercise and hold, and the value of the stock drops. This isn't universal and there are different rules for different types of employee stock options, so make sure you know the rules that apply to you if you are considering an exercise-and-hold.
AMT I think it was called.