I have been diving in Saudi since 1999, and in Jeddah since 2001. There are several beach "resorts" that offer fair-pretty good diving. Al Bilad Beach is very basic in terms of facilities, but is worth it. The diving there is one of the best places north of Jeddah. Al Nakheel is decent, with the kitting up area right out at the entry/exit point, and they have night diving. Intercontinental Beach is good, but don't go north, it's full of rubble from other beach resort construction. Sheraton is about the best for facilities and ease. You can kit up right at the entry point, where there is also a shower and shaded spots for your gear or people who aren't diving but want to hang out nearby.
I also regularly frequent Desert Sea Divers. The manager there, Abu, is extremely friendly, and is always willing to give you a very fair price. Their boat trips are always fun, with experienced captains and divemasters. The two I know, Bill and Ben, are very knowledgeable and fun to be with. I am doing the Divemaster course myself, and think that they are the kind of role model to emulate.
I had previously heard bad things about Dream Divers, namely canceling trips at the last minute (because they could get more money from other higher-paying clients), but was shocked to hear about the Ann Ann shark incident.
Anyone wanting more info can reply here in this forum, and I'll be happy to email you. Cheers!