I always wrote the one page cover letter, until I had my first job reading the f***ing things.
I have twice had to fly a desk where some of my time was consumed sifting cover letters/resumes. If it is over a paragraph long STOP. Unless you have a really interesting story to tell, i.e. you were a spy or you have a couple of space shuttle missions under your belt (One guy did, we called him for an interview even though he really did not meet the minimums) keep it short and to the point.
On the few occaisions I have to write a cover letter I try to keep it to just a couple of sentences.
(Just to forestall the inevitable flames - the shuttle astronaut was a commercial pilot but he had flown the shuttle twice as a mission specialist.)