Great discussion going here. Drying socks can be a tough area to really succeed at in the wilderness. I'll write about what's working for me.
Some people say to just live with wet feet, but for me when my feet are wet for a prolonged period then they wrinkle up (prune feet) and this is shortly followed by blistering. I had this pretty bad two weeks ago. The only way for me to have prolonged wet feet and not blister, is when I generously use Sportslick or Hydropel. This technique works, but it's not a very enjoyable strategy to have wet feet all the time when there are other strategies that will get you dry feet with minimal effort. I use this technique only as a last resort (ie. all my socks are wet).
IMO, the most important consideration for drying socks is choosing the right socks in the first place. I like very thin synthetic socks that are as fast drying as possible. Drying times are far more important to me than stink. Wool socks are way too slow drying and even most synthetic socks are too slow. I like DeFeet Ventilator LiteLow socks and I'm hoping to try those 'hyper thin' Drymax socks sometime if I ever get a mailing address. Check out the road cycling section of your local REI or cycling shop for some nice light, thing low synthetic socks.
Using the right socks, I hang them off my pack to dry if I have the weather conditions and sock supply to allow this, otherwise I dry them by sleeping with them on. The other alternative to drying socks is to use Rocky Gore-Tex socks to avoid getting wet socks, and then you hope your feet never get too wet. If they do, change your socks for dry ones and carry on. I've had good results with this, but I'm sure the Rocky socks will wear out if you use them for a lot of miles and the socks add a bit of weight and lead to damp feet due to zero breathability if your socks are wet....so you need to keep changing your socks which is a pain since Rocky Gore-Tex socks are difficult to get on/off. Overall, it's not a bad technique but it is a bit of a vulnerable one.
To dry my thin synthetic socks by sleeping with them on, obviously I start by giving them a solid wring out. Then I put them on once I've entered my shelter for the night. They are a bit chilly and uncomfortable for about 10 seconds, and then they are just wet but warm. The socks are obviously sorta wet for maybe an hour and then after that they just feel somewhat damp, but not uncomfortable at all. By the time I'm done reading and ready to sleep, they are at the damp state and they end up being bone dry in about 3 hours total.
"Putting your wet socks into a down sleeping bag at night is just asking for trouble. I can only imagine that this would be feasible with a synthetic sleeping bag, if the nighttime lows never get below 60*F, and if there was just not enough sun to dry them out by hanging them on your pack."
This comment sounds like it's from someone who has never tried this. Drying socks is your sleeping bag is far more feasible then you're giving it credit for. I dry socks regularly in my down quilt with lows down to 40F, even in very humid (temperate rainforest) areas. Obviously the humidity gathering inside my down bag is impossible to measure on the trail, but I suspect my down bag breathes well enough that significant moisture does not accumulate. I've never noticed any sort of loss in loft, even when doing this every night for up to 5 nights consecutively.
One final comment is that hanging your socks from your pack works very well in conjunction with wearing them to bed. If you can get your socks to the 'damp' state by hanging them from your pack, then they won't be uncomfortable if you put them on to wear to bed and they will be dry in no time if you are using the right socks.