Harder, Better, Faster, Stronger... Techniques for an image-based CAPTCHA?

Make each letter/number out of a pattern, I.E. unconnected dots. Meaning the computer has no way of knowing that a dot is part of a letter other than pattern recognition (which they don't have yet.) Then the usual distortions and random lines.

How you do this is the challenge.

EDIT: Also, bonus points for patterns of different shapes, and try alpha transparency on the characters (on the edges or the whole character), so they merge with the background.

Make letters difficult to separate. Use handwriting-like font or add lines that join letters. Decrease and randomize spacing between letters.

Add wave distortion in other axis too. Distortion in one axis only can be relatively easily analyzed and reversed.

Don't bother with color background at all. It's super-easy to automatically filter black from other colors. Your background hinders only humans.

Don't add scratches or other noise unless it has the same thickness as letters. Noise-removal algorithms can easily remove things that are thinner than letters.