However I've been playing with OpenSim and it gives you your own second life world, but with almost no internal content, so of course, it was back to the duck walk.
I'd also seen some 3rd party second life browsers, that included a 2 line patch that improves the default walk animation. It does improve the default walk animation a bit, by just playing it at half speed, so the animation seems less abrupt, but the avatar's upper body still flops.
So I wondered, where was this animation coming from?
That appears to be llkeyframewalkmotion. As far as I can tell the animation is generated by moving the avatar's feet and pelvis, and then letting the avatars skeleton model figure out when the rest of the body should go.