People apparently use Hibernate with the DAO pattern but it looks like
some ppl have trouble with lazy initialization--perhaps because of their
implementation. Could someone please layout the implications of using
DAO and lazy initialization and offer some basic guidelines for
implementation or just enumerate the major related pitfalls?

Thanks,
Sean Gunn

All the implications are spelled out on topics in this forum. Mainly, the issues relate to DAOs controlling the opening/closing of a hibernate session and returning entities loaded by those DAO directly to the view.