Some methods I generally use to create my own rewrite rules for WordPress. Taken from WordHub project.

wordpress-rewrite-rules.php

<?php
/**
 * Some basics for creating your own rewrite rules in WordPress. Taken from
 * my WordHub plugin.
 */
class Whatever {

    function init() {
        add_action( 'rewrite_rules_array', array( $this, 'rewrite_rules_array') );
        add_filter( 'query_vars', array( $this, 'query_vars' ) );
        add_filter( 'template_redirect', array( $this, 'public_template' ) );
    }

    /**
     * Flushes the URL rewrite rules. Needed if the plugin adds its own rules.
     */
    function flush_rewrite_rules() {
       // global $wp_rewrite;
       // $wp_rewrite->flush_rules();
    }

    /**
     * Adds new rewrite rules to the $rules array. 
     *
     * @return array New rewrite rules.
     */
    function rewrite_rules_array($rules) {
        $newrules = array();
        $newrules['wordhub/(.+)'] = 'index.php?wordhub=true&wordhub_repo=$matches[1]';
        $newrules['wordhub'] = 'index.php?wordhub=true';
        return $newrules + $rules;
    }
    
    /**
     * Adds query variables to WordPress URLs. Allows us to check if 
     * ?wordhub=true and other query variables. Used for URL rewriting.
     *
     * @return array New query variables.
     */
    function query_vars($vars) {
      array_push($vars, 'wordhub', 'wordhub_repo');
      return $vars;
    }

    /**
     * Tells WordPress to use the specified template file if a query variable 
     * has a certain value. Checks if active theme has the template file, and
     * uses that instead of the one included with the plugin.
     */
    function public_template() {
        global $wp_query;
        $wordhub = isset($wp_query->query_vars['wordhub']); 
        if(!empty($wordhub)) {
            // Check if there's a template in the active theme, use the default one if not.
            $template = file_exists(TEMPLATEPATH.'/wordhub-template.php') ? TEMPLATEPATH.'/wordhub-template.php' :  dirname( __FILE__ ) . '/wordhub-template.php';
            include($template);
            exit;
        }
    }

}