Led by scientists from NASA's Jet Propulsion Laboratory (JPL), the University of Colorado, and the University of Central Florida, the team studying the Cassini data have modeled several different possible sources of the plumes and jets, which some claim resemble icy versions of the geyser Old Faithful. One of the most popular theories in the past has attributed the water effects to tidal pressures. However, recent observations seem to contradict this theory (although it has not been ruled out entirely).
The current data falls in line with the presence of an underground warm water reservoir, much like Lake Vostok, a 650 feet deep lake found underneath the ice of Antarctica. In this system, vents act as nozzles channeling water to the surface at supersonic speeds, causing eruptions when the water breaks through. A detailed mathematical model representing this theory was developed in 2007 and so far all observations fit the model. Much more data is needed before a definitive declaration that water exists can be made, but the early signs are promising.
NASA plans to spend a great deal of Cassini's current Equinox Mission (scheduled to run through 2010) studying Enceladus and exploring the possibility that it holds liquid water under its surface. The Equinox Mission has already visited Enceladus three times since August and at least four more flybys are planned. Proof of water on Enceladus would be a major breakthrough as the moon would then meet every known criteria necessary for sustaining life.
You can read more about the Cassini Enceladus flyby, the theories explaining the moon's geysers, and future plans to study Enceladus in a recent NASA article on the subject here
. A timeline of Cassini events during 2008 including descriptions of the three Enceladus flybys is available here
. Cassini researchers maintain a blog with many posts outlining the technical and scientific details of the Enceladus studies here
, and a large archive of images taken by Cassini, including images of Enceladus can be viewed here