The 1.2.3 LiveCD snapshot around July 24 offered an option to activate the serial console during setup, as described here: http://doc.pfsense.org/index.php/InstallationGuide
However, the latest images like pfSense-1.2.3-20090822-0454.iso.gz is missing this option. So you have to boot up on a PC with VGA, configure the NICs, log in from another PC via 192.168.1.1 and set "Enable Serial Console" in System > Advanced. Is there any way to do this on command line?
Another difference I noticed between the before mentioned images is that the July image offered a menu at the serial console to reboot, halt, or set up the NICs, while the latest image immediately quits at the command line.
FYI, I set up a flash drive using the CD image instead of the flash image because the 22/08 4G flash image does not offer the Squid 2.6 and SquidGuard packages that I need to filter some annoying ads and stats sites. After setup and switching to serial console, I then place the flash drive into the Alix2.