I'm a cheapie too......
I decided to setup my own home network solution about a year ago, and have been enhancing it ever since. Basically, I could afford a new gaming pc, and so reused my old desktop, along with several old carcasses I had hanging around.
I went for Ubuntu as the OS of choice, installed on my P4 2.6 with 1 gb DDR333. In there I have a SATA raid card with 2 x 400Gb drives, and an 80gb for the OS.
The server does the following:
Network storage (Samba)
network firewall and router
Streaming media server
I have 3 client machines around the house and 2 laptops. All running windows of some sort. The samba server does its job dutifully and reliably. I have VPN access for when i'm on the road and need my files. Use SSH and webmin to administer the box.
I use a PHP script called "Kplaylist" which is excellent and lets me listen to my 80Gb+ of music wherever I am.
Throw a 5 quid modem in the box, and take your pick of SIP server software to route SIP calls through your low rate BT landline.
Currently, it does everything I need it to, and reliably too. ALL of the software running is open source or free, and the machine itself cant be worth more than a hundred quid. I generally use Kplaylist to stream music externally, or a media center of some sort on the local network. I cant decide on one, keep switching between the open source "Media Portal" and vista's media center. Media portal is excellent once set up, and has a myriad of options and plugins available. Vista's MC is a bit slicker and more polished, but with much less options. Personally, I hate the way it displays music, but its TV software is excellent. Personal preference on that one i think.
I have no issues streaming DVD rips from the server to the laptops wirelessly (802.11G), and so can plug my laptop into the nearest TV and have my films wherever I want in the house. I even have waterproof speakers in my showerroom with a 3.5mm socket outside for laptop / MP3 player to plug into.
Using Ubuntu as the firewall / router means I can monitor all network traffic on my circuit. This would be useful for parents, restricting what they can access etc. Personally, I find it amusing to browse my flatmates visited webpages occasionally!
I think the key to setting up a satisfying home server, is not the capabilities, but the execution. All of the services mine provides are relatively simple and easy to install (can do a complete re-install in a few hours). But if you have cables running messily around the house, or flakey hard drives, or even badly disorganised data, the usefullness and satisfaction of the server disappears. Focus on getting everything you need to make living with it a pleasure. For me, this meant having white plastic trunking to hide cables as i didnt fancy pulling my walls apart. Also, putting the server in my cloakroom eliminated the annoying fan noise. Lastly, I have recently installed a remote controlled power regulator. Meaning if (or when) it falls over, a simple access code in a webpage power cycles the system.
Hope to have been of help!
ps. Kplaylist is my most used service (beside mail server). It really is a nice script. Check out my implementation at:
"guest" and "password" ;-)