You know, the way that Genesis jumped from genealogy to Babel back to genealogy really is quite sudden, which makes me respect the JEDP theory a bit more. I mean, it does sometimes have the appearance of a collection of fragments. But on the other hand, nearly everything that we have read so far has clear logical and historical connections as you move from section to section. It starts with creation, progresses to Adam, then to his children, then on down to Noah, then it gives the Table of Nations as the world is repopulated, and now we see the tower of Babel which is (apparently) the next significant event now that the world is being repopulated after the flood.
In the aftermath of the flood, it would make a lot of sense that the people would share a common language, and to a large extent live in the same region. Certain elements here are obvious summary statements and should not be interpreted literally. For instance, verse 3. This is not meant to be a literal statement about men saying, at one specific time, "let's bake bricks". It is a summary statement to describe perhaps decades of hundreds or thousands of people collectively deciding to build brick structures in a general area.
That said, verses 5-7 are very interesting and as I have said often before, it is broadly interpreted by nearly everyone to mean nearly everything. Pretty much anyone who reads this passage forms a strong opinion about what it says about God and how he deals with people. The most common negative interpretation is that this shows God wanting to clamp down on human independence and unity: that humans are capable of so much, that he just has to beat them down a little.
The most common conservative interpretation looks at a few key elements. 1) the people are gathering together and refuse to spread over the earth. This is directly contrary to God's command/blessing, which tells man to spread over the earth. 2) building a great tower is indicative of pride, especially when they say "reaches to the heavens". This is an early example of "man as god", the human desire to achieve godhood, in terms of power and greatness. This is a desire that has been acted out for many thousands of years, and is seen today in such things as Kurzweil's Singularity theory and associated dreams. I don't accuse them of doing anything worse than anybody else, but I have to say based on passages like this, that their dreams are most likely misplaced. I don't believe that God is going to open the door to human godhood (immortality on earth, omnipotence, omniscience) anytime soon, and certainly not before human redemption through Christ.
So yeah, the conservative reading takes this not as "hey, let's build a city" and more as "hey, let's challenge God". And it's not that God is offended or something, but the obviousness of God's greater power requires that the human endeavor should fail, lest they continue in their self-deception to their own detriment.
One thing that I find very interesting about this passage is that, while everyone imbues it with a moral connotation, at least in the English translation there aren't any moral expressions (i.e. wicked, evil, good, bad). All of the actions are described in morally neutral terms, which is possibly why this passage has resulted in such divergent viewpoints (God the domineering, humanity the unruly).
That's all I have to say on Babel. Next is the genealogy of Abram, and I think I said this before but Abram is the same person as Abraham. They are two different names for the same person.
From the list of names, we still see the pattern of gradually decreasing ages. While the genealogy of Adam to Lamech showed between 700 and 900 years of age, in this genealogy we see the ages of people shrinking from 500 down to about 120 years. Similarly, the age at which men have their first child decreased from 60-130 years down to about 30 years.
Also, this list is somewhat redundant with the genealogy in chapter 10. However, like I said there this one is a directed genealogy, so it is written with a different purpose than the Table of Nations. In this one, it is written to show the heredity of Abram, how he is a descendant of Shem (the son blessed by Noah).
The rest of the chapter is just setting the stage for Abram's story, by describing his family, his father's family, and where they live. It describes their travel from Ur towards Canaan, before having heard anything from God.
When it says they "came to Haran", it is talking about a town/city they founded that they named Haran after Terah's dead son. It is common in antiquity to name cities after your children. We will see this at least once more in the bible, also in Genesis.