I am a member (actually President) of VicLUG
which is my local LUG but sadly a half a continent away from you.
As for what we do here are a few of the things:
Displays: we show off our stuff @ local hobby shows including a train layout for the model railway show here in town and an annual display by a local museum that gives us a section of space for three months between New Years Day and the end of March.
Kid Build: we have several bins of mixed LEGO that we provide for use by local events like Beaver Scouts, and Gottacon, a local gaming convention where we also run a "VicWars" table (VicWars is what we call our version of BrickWars).
Drafts; We all buy the same set, usually on sale and then combine all the sets together. We then take turns taking one element (ie: all the 1x2 yellow brick, or all the 2x2 dark tan tiles, etc) until the whole bunch has been distributed. Great way to have some fun and get a bunch of pieces.
Dirty Brickster: usually at our Xmas party/meeting we do this "dirty" gift exchange with each putting in one LEGO "gift" of app. $20 value.
BrickCon: we arrange group travel to our nearest LEGO fan convention which for us is BrickCon
every year in Seattle. We share a van and hotel room(s) to make it more reasonable.
Summer BBQ: just a social gathering in conjunction with a meeting in the summer.
LUGBulk: the super-secret program that allows LUGs to access large amounts of bulk elements for building collaborative displays.
That's all I can think of off the top of my head.
EDIT: You can see some of what we do in our Flickr Pool
which I think you should be able to see.