I am running Linux or FreeBSD on multiple used PCs that did not come with Windows licenses1. On the Linux side, Ubuntu has proven to be very easy to set up and use. If I had to choose one Linux distro, presently I would pick Ubuntu. There are several flavors of Ubuntu that use different desktop environments. I have one PC running Kubuntu and after using KDE a while I still prefer the more minimalist GNOME in Ubuntu. I have also tried the even more minimalist Xfce in Xubuntu.
I have occasionally used CentOS which is derived from Red Hat Linux. There are differences in the way Red Hat (CentOS) and Debian (Ubuntu) do things and running CentOS helps me learn those differences.
Sometimes a Linux live CD comes in very handy. I have used Knoppix to recover files from a corrupted Windows PC. Also in my live CD kit are SystemRescueCD, Damn Small Linux, and Feather Linux.
If you have an old PC (well, I suppose you could use a new one) and two network cards you can set up a firewall using IPCop.
Among the other Linux distros I have tried are Debian (too close to the edge for this Linux n00b), Fedora (not bad but didn't quite fit), Puppy (a little too cute), SUSE (a little too Novell), and Xandros (a little too Windozey).
Xandros version 3.02 OCE (Open Circulation Edition) was the only Linux distro of those I tried that I could get to run on an old Micron notebook PC, so I did use it for a while. That version of Xandros was like the Windows 98 of Linux. Ultimately I prefer a Linux distro that doesn't try so much to be like Windows but rather strives to be useful, flexible, and discoverable in its own way.
FreeNAS is a free Network Attached Storage server operating system based on FreeBSD.
1 Windows licenses are not transferable. I'm not going to pay Microsoft again to put Windows on a PC that came with Windows installed and paid for once by the OEM. I wonder how much Linux uptake has been encouraged by this (stupid) licensing policy.