Yup, just found this thread cause i cant craft snow balls either... think ill try shauns solution and see if it works since I had a few snowballs left from before the update... how silly...
I just tested this and the answer is no. The snowballs dropped by snow golems when you kill them are the plain snowballs that can be used for crafting snow blocks. The snow they cause to appear on the ground still gets collected as id 332:1 though, unless you stack it into a stack of regular snowballs as you collect it. I'm using the old-snowball stacking trick to gather snow at the moment.
Well, yes and no. You can't make a golem unless you have snow blocks already, because you can't make them out of the snowballs that you dig up fresh without first having at least one old snowball. And if you already have snow blocks, why not just place them and use a shovel to break them? They also give the old snowballs. No need to waste a pumpkin! That said, to anyone that needs an old snowball to start making new stacks of them, I have plenty! Let me know and I'll give you one as a starter. UPDATE: I tested this out on SSP and found that the snow there digs up as normal snow, so this is, in fact, a bukkit problem I do believe. Might have to check that out.
Necromancy, GO! I thought I'd update anyone interested about this: I was looking through craftbukkit's github and saw that they corrected the subtype of dropped snowballs so that they can be crafted into snow blocks properly once more. Hooray!
Yeah, I've heard complaints that "these damn snowballs wont craft" but I could never figure it out myself. Good job, raenis, for solving a mystery that I'm sure very few of us could have figured out on our own.