I saw it when i was browisng downloadable falling sand games last year. I eventually got bored of the elements and drifted away. In early July my friend from school who I introduced it to told me that there was a new version. I eventually downloaded it from the site and i fell in love all over again.
In the beginning i've found it on the www.small-games.info (this is russian site) more than year ago. It was ?.?? version of PT, even without autoupdate. I played it ~ six month and searched for new version... but nothing. I thought that game isn't developing. But two month ago on the same site i suddenly found new 38.0 version of Powder toy! I was so glad!!! Since that time i am here
EDIT: btw, i've found dan ball's powder game by Googling "games like powder toy"
I found out because my brother. He showed me the original one on the PSP about I forgot how long ago. Then Skylark improved it, and well crashed. Then I found this one through the fan page.
It was recommended to my cousin, who showed his one (the old version) to me. I remember thinking a more advanced version would be even cooler, and when I tried googling the powder toy, I noticed something was up with the website, and people on other websites were complaining about it. After more searching around I found some YouTube vids made on the old version. I'd played it on my cousin's computer, so the videos were of no interest, but one comment mentioned it being an old version, and that there was a version 30-something out, though it didn't say where to get it. More searching around, and just when I was ready to give up and settle for the old version, I clicked a link, and found this site, with v39.0 piping hot and ready to go!