But Project Management can happen quite successfully without roping in all the developers. One of their more useful skills is liasing between two development managers.
We also found a way to "de-Waterfall" a Product Manager: it is basically stealing incomplete designs for the developers to play with :-) though this works better if he can be convinced to hand them over voluntarily. But the Project Manager has to be able to sooth ruffled feathers when the Product Manager keeps getting given suggestions to improve the design before he's "ready to release it".
Wade.