Yeah, Linux kicks ass!
Seriously, though, if you're at all serious about this, a Linux firewall/DHCP/DNS server (Doesn't need to be that powerful, 300MHz, 128MB and you'll be more than fine, 64MB if you don't want video) and a hub/switch is definately your smartest (maybe most cost effective?) choice.
If you didn't know already, Linux is freely available.
"If you teach a child to read, then he or her will be able to pass a literacy test" - George W.