Here is the promised blog post about using Attendance2 to track participation. You can continue to use the Status1 values to track (Absent, Present, Excused, etc.) and then use the Status2 values to track participation. There are options in the Report Settings to include the Status2 values in the various reports.
Here is what I did for one class where I expected each student to participate at least 20 times during the semester, but wanted to limit them to a maximum of five participation points per day. I added Status2 values of: P0 (with a Points value of 0), P1 (with a Points value of 1), P2 (with a Points value of 2), P3 (with 3), P4 (with 4), and P5 (with 5). P0 should be the first one so it is the default value for Status2.
After taking attendance using the Status1 values, scroll left in the buttons (first one says "Show All") until you see the "Show Present" button and press it so you only see the list of people who are present that day. Continue scrolling the buttons, until you see the "Use Status2" button and press it. Now you should see the list of people present that day and each person should have a "P0" status (assuming you added the Status2 values before adding this date to take attendance; if not, you'll have to press the status button for each person one to get to P0). Each time a person participates that day, you tap his/her status button to move to the next status (e.g., from P0 to P1). Once someone reaches P5, I would not tap on them again that day. You can use different colors for the statuses to make it easy to see. I made P0 black, P1-P4 green, and P5 red. In the Take Settings, I set the Status2 point total for Red Name to 20 so once a person has participated 20 times during the semester, his/her name will be shown in red when viewing the Status2 values on the Take attendance screen. The Start Date/End Date in the Report Settings control which dates are used for the Red Name so you can use a subset of the semester if you want. Also turn on the "Status 2" and "Point Total" settings in the Report Settings to view these in the reports.
Someone requested a way to see which people haven't participated much recently by having their name turn red. Here are the Status2 values and the corresponding point values I would use for this: Silent = 1, C1 = 0, C2 = -1, C3 = -2 where C1 with value 0 is the level of participation you want each day. Remember, what's happening is you're adding the values up and the name appears red when it reaches a certain value such as 3 (default). So if someone contributes exactly the amount you want (C1) each day, they have a value of 0 and their name will not be red. But at the start, if someone hasn't contributed at all, after three days with "Silent", they have a total of 3 and they will appear red. If someone contributes a lot for a few days they'll have a bunch of negative one values so they can be silent for a few days before their name would turn red. You can obviously adjust the values a bit, but the idea is to use 0 for the amount of participation you want each day from a person and positive values for no contribution and negative values for participation with them being more negative the more they contribute. There is a minor bug in version 1.3 and earlier that prevents the name from changing to red/black correctly for the Status2 values, but this is fixed in the new update I submitted to Apple today (Friday 12/28/12).
You can download sample Attendance2 course files that you can place in your Dropbox/Apps/Attendance2 folder and import using the "Restore from Dropbox" option. Participation1.adz uses the P0-P5 described above and Participation2.adz uses the Slient, C1-C3 values. After loading them on your device, you can open your own course, choose "Import from Existing course", select the Participation1 or Participation2 course, and then select "Statuses" and press the Copy button to import its Status1 and Status2 values into your course.