For various reasons, I need to keep the computation together in a single query (the example uses @vars but the real code is grabbing a gazillion birthdays and computing the age). Anyhow, with a slight rearrangement, your code maps to something like the following:

DECLARE

   @birthdt DATETIME,
   @targetdt DATETIME

SELECT
   @birthdt = '1/15/1930',
   @targetdt = '12/31/2000'

SELECT
    age = CONVERT(INT, DATEDIFF(yy, @birthdt, @targetdt)) -
          (CASE WHEN (MONTH(@birthdt) = MONTH(@targetdt)) AND 
                     (DAY(@birthdt) > DAY(@targetdt)) 
                THEN 1 
                ELSE 0 
           END)

I'm still wondering, though, whether there's an easier way to do this?