Best way to copy a database (SQL Server 2008)

Dumb question - what's the best way to copy instances in an environment where I want to refresh a development server with instances from a production server?

I've done backup-restore, but I've heard detach-copy-attach and one guy even told me he would just copy the datafiles between the filesystems....

Are these the three (or two, the last one sounds kind of suspect) accepted methods?

My understanding is that the second method is faster but requires downtime on the source because of the detach aspect.

Also, in this situation (wanting an exact copy of production on a dev server) what's the accepted practice for transferring logins,etc.? Should I just backup and restore the user databases + master + msdb?

Easiest way is actually a script.

Run this on production:

USE MASTER;

BACKUP DATABASE [MyDatabase]
TO DISK = 'C:\temp\MyDatabase1.bak' -- some writeable folder. 
WITH COPY_ONLY

This one command makes a complete backup copy of the database onto a single file, without interfering with production availability or backup schedule, etc.

To restore, just run this on your dev or test SQL Server:

USE MASTER;

RESTORE DATABASE [MyDatabase]
FROM DISK = 'C:\temp\MyDatabase1.bak'
WITH
MOVE 'MyDatabase'   TO 'C:\Sql\MyDatabase.mdf', -- or wherever these live on target
MOVE 'MyDatabase_log'   TO 'C:\Sql\MyDatabase_log.ldf',
REPLACE, RECOVERY

Then save these scripts on each server. One-click convenience.

Edit:
if you get an error when restoring that the logical names don't match, you can get them like this:

RESTORE FILELISTONLY
FROM disk = 'C:\temp\MyDatabaseName1.bak'

If you use SQL Server logins (not windows authentication) you can run this after restoring each time (on the dev/test machine):

use MyDatabaseName;
sp_change_users_login 'Auto_Fix', 'userloginname', null, 'userpassword';

The fastest way to copy a database is to detach-copy-attach method, but the production users will not have database access while the prod db is detached. You can do something like this if your production DB is for example a Point of Sale system that nobody uses during the night.

If you cannot detach the production db you should use backup and restore.

You will have to create the logins if they are not in the new instance. I do not recommend you to copy the system databases.

You can use the SQL Server Management Studio to create the scripts that create the logins you need. Right click on the login you need to create and select Script Login As / Create.

This will lists the orphaned users:

EXEC sp_change_users_login 'Report'

If you already have a login id and password for this user, fix it by doing:

EXEC sp_change_users_login 'Auto_Fix', 'user'

If you want to create a new login id and password for this user, fix it by doing:

EXEC sp_change_users_login 'Auto_Fix', 'user', 'login', 'password'

UPDATE:
My advice below tells you how to script a DB using SQL Server Management Studio, but the default settings in SSMS miss out all sorts of crucial parts of a database (like indexes and triggers!) for some reason. So, I created my own program to properly script a database including just about every type of DB object you may have added. I recommend using this instead. It's called SQL Server Scripter and it can be found here:
https://bitbucket.org/jez9999/sqlserverscripter

I'm surprised no-one has mentioned this, because it's really useful: you can dump out a database (its schema and data) to a script, using SQL Server Management Studio.

Right-click the database, choose "Tasks | Generate Scripts...", and then select to script specific database objects. Select the ones you want to copy over to the new DB (you probably want to select at least the Tables and Schemas). Then, for the "Set Scripting Options" screen, click "Advanced", scroll down to "Types of data to script" and select "Schema and data". Click OK, and finish generating the script. You'll see that this has now generated a long script for you that creates the database's tables and inserts the data into them! You can then create a new database, and change the USE [DbName] statement at the top of the script to reflect the name of the new database you want to copy the old one to. Run the script and the old database's schema and data will be copied to the new one!

This allows you to do the whole thing from within SQL Server Management studio, and there's no need to touch the file system.