High demand for an offer of free money is unsurprising, to say the least. And so it was for the "Track 2" funds authorized by EGTRAA, aka the stimulus bill. There have been two previous deadlines: one in July that was basically for anything that had been batted about in the various state transportation planning offices, and a second in August for small to medium "ready-to-go" projects, with some states using a pretty expansive definition of shovel-ready.
I haven't read all of the proposals for the third round, but as the TTP points out, giving most of the money to California makes a lot of sense. The $10B in bonds authorized by citizens of the Bear Republic is probably about $9.9B more than any other state has committed to high-speed rail. If I were made SecTrans for a day, I'd give CHSRA $4B, Maryland $1.5B for fast-tracking the Baltimore tunnel replacments, $1.5B towards the more cost-effective small projects, and the rest for planning the more plausible large projects. Not much can be done with $8B - it's only 1% of my estimate for a full HSR network build-out. So the current round of money should be concentrated where it can do the most good.