Any way to round up animals in Minecraft?

I want to farm sheep for their wool. What's the best way to make them spawn or gather them up into one pen?

Edit: The answer below is now outdated since a much easier solution exists – by holding wheat for cows, mooshrooms and sheep, carrots for pigs, and seeds for chicken, animals will follow you. After rounding up two of each animal, you essentially have an infinite amount of them, since you can breed them. Sheep also regrow their wool by eating grass, so you don't even need to breed them to have a constant supply of wool.

Here is a modular design to make a series of spawning pads that will spawn animals, and collect them in a central area. The pads end up being 8x6, except for the ones right next to the collection pit which are 4x6.

The glass area here would be fenced off.

They all drain to this central pit.

Water is placed at the beginning of each trench, and the signs prevent water from moving backwards. This is a secondary intersection that continues off each main channel. (The water should be flowing right to the sign, I might have made the channel too long in my haste.)

And now that Single Player Commands is working with the current version of Minecraft: an aerial view!

If you place torches in a pen, neutral animals will spawn there more because they'll be spawning at night and day, whereas normally they'd only spawn at day. They'll also be spawning more concentrated there at night.