So, everyone knows ie9.js (from http://code.google.com/p/ie7-js/). It seems to work, but it never left beta since the last release in 2010.
Obviously, there are some other things that do something a bit similar (such as modernizr, html5shiv, and CSS3Pie), but they aren't quite the same (not least because they need to be applied per-feature or are more limited in scope).
Is it still considered good practice to use it for modernisation? Should I be using something else?
ie9.js is still a good piece of code. It does a lot of work, fixing up stuff that IE gets wrong.
As you rightly point out, it is now an old piece of code, but it does still work.
Reasons why people might not be using it so much any more:
Of the tools you mentioned as alternatives (modernizr, html5shiv, CSS3Pie), none of them actually have any feature cross-over with ie9.js at all. (see also this answer)
However, here are some more recent tools that might be good alternatives to ie9.js:
Given that the vast majority of JS code in the browser is written using jQuery these days, this basically reduces the need for an all-encompassing IE-fixer patch like ie9.js down to virtually zero.
However, if you're not using jQuery or a similar library, then you may find ie9.js can still work for you very well.