I'm told that compact flash has an interface very similar to IDE, that being said IDE is not trivial to communicate over. The easiest way is to do as zklapow recommends, buy a pre-made control chip. Sparkfun has boards that even have filesystem support builtin.

I assume you are looking for an embedded solution, since you could easily get a reader for a desktop or laptop computer.

People have written SPI IDE interfaces, which you might be able to run on an AVR. I will link to one that runs on an ATMega32. It may be too big for an ATMega168, but it should fit on a 328, though it may need a bit of cleanup to account for the Arduino bootloader if you go that route: http://forum.6502.org/viewtopic.php?p=8343&sid=a06dc948bd456b223cf8a93d175d37e1

I have seen a lot of work on this for the PIC series of microcontrollers as well. A simple search on PIC and CF should return plenty of details, though the hardware and article linked above by zklapow should be more than sufficient to complete the project. I just wanted to add in an AVR solution for those who are looking since I know there is a big Arduino community here.