Have you installed the jQuery-vsdoc.js file as well (in the same location as jquery-1.2.6.js)? This file contains the comments for intellisense. It's documented in step 3 of ScottGu's blog post.
Update:
And you also installed the Visual Studio patch?
For me it works (as shown in ScottGu's blog), although I'm using a website project, not MVC. I added the script reference in the master page:
<script src="jquery-1.3.1.js" type="text/javascript"></script>
I get intellisense in both the master page and in content pages (tried it with the code you put in your question).