Despite some earlier server problems, SmoothWall 2.0 has been released this evening – there are also release notes available.
I installed Smoothwall on some older hardware before the 1.0 release, but I have never used it in a “production” kind of way. The hardware requirements are quite low. It allows for some more advanced firewalling, DMZs, and other great stuff. (I found my post about the 1.0 release via google)
At some point a little over a year ago, a nasty fork resulted in a new project called IPCop. At this point both projects look like a good homebrew firewall option. Of course, you might also consider a tweaked OpenBSD box or a commercial solution like Sonicwall.