nyc,
I am a big art fan, but haven't been into collecting/investing at all and don't really know anything about it. Just recently I started going to galleries more often and starting to learn about the collecting world. A couple of friends of mine are pretty avid collectors (in the $10-50k range of purchases) and they have been introducing me to some folks in the gallery community here.
Hackett Freedman is one gallery I really like. One of the current exhibits there, Guy Diehl, is the sort of artist I would like to buy earlier in his career before getting very expensive like his work is now. As has been said already, I'd be buying stuff that I really enjoy having, with the financial possibilities secondary. Seems like a lot of reading, a lot of gallery visits, and talking to lots of people about which up-and-coming artists they really think highly of is the best way to do that sort of thing.
On the professional side, the gallery owner told me a pretty crazy story. He said, partly due to Europeans and largely due to Asian collectors getting much more into the scene, art prices have been going up very steeply in the last couple of years. Especially Postwar American works. His job is basically to scan every auction listing every week. He showed me one artist (I'll have to go back to get the name) that he had been trying to sell for a while for about $150k. He ended up getting about $200k for the painting, a nice almost 100% profit. He said he was very surprised at how quickly the buyer said yes with little to no negotiation. But then two weeks later he saw it auctioned off for $600k!!!! Apparently he had missed one auction report a month or so back where a number of this artist's works had sold for 2-3x what they were going for a year earlier. Lots of random and unexplained spikes in this market, makes the stock market look easy and calm.