A while back, our team helped the Small Business Server team with some interesting VSS issues just before shipping SBS 2003. The issues were solved, and each member of our team got a free CD of SBS 2003. So, I decided to do something with it - an SBS machine that also can be used as a SBS and backup server.

After several trips to Fry's (to watch for the green labels and get the best deals) this is what I settled for:
- Case: Antec Sonata II. A little bit pricey, but I wanted a case with a real solid design and a very good power source (Antec SmartPower 2.0 450W). Price after rebates: $70, which is pretty good keeping in mind that only the source is sold separately for almost $60. This is the only component from the server on which I didn't try to get the cheapest thing available. You should never go cheap on the power source, or you'll regret.
- MB + CPU combo: ASUS K8V-MX plus Athon64 3000+ socket 754. Price: 130$. Cheap, powerful enough (more than enough) for what I intended to do, but unfortunately no Gigabit ethernet. Still, I had video output included thanks to the K8M800 chipset, which saved me from buying a separate video card.
- CPU fan: 15$
- Memory - 2x512 PC3200 DDR400: 70$.  Probably even cheaper these days.
- Two 250 GB SATA harddisks: $60 each after rebates. I intended to use them to hold the backups. A RAID-1 controller is included in the motherboard, but unfortunately it is not bootable, so I needed a separate harddisk to hold the OS. Even if they have very similar characteristis, the harddisks are not the same model (Western Digital and Hitachi). I could get only one of each due to the "one rebate per house" limitation. So this is an unusual mirror pair, but it seems to work pretty well.
- One additional 200 GB PATA main harddisk to hold the OS. Probably overkill, but I thought it was a nice deal to get it for only $40 after the rebate.An alternative was to buy instead a dedicated Adaptec PCI RAID controller which is bootable from (and use the SATA harddisks to hold everything), but I would have ended up with the same price anyway.
- No mouse, keyboard, video card or monitor. It's a server after all. Like an iPod, the server itself has only two cables going into it: the network cable, and the power cord. (I needed to borrow a keyboard, a mouse and a monitor during SBS setup, however).

Total: $445 (after various rebates). Max downtime on future issues? A few days, (including more Fry's trips) which is good enough for me. If any part breaks, I can replace it easily (and if the main PATA harddisk breaks, all I have to do is to buy another one and do an ASR restore).

The most painful part in this scheme was the SBS setup, which required countless reboots (to install SBS 2003, then SBS SP1, then apply various security patches, etc.). But now it pretty much works by itself, with zero management from my side.

In the end, I have a nice-looking NAS box with lots of free space on backup shares. With Exchange, Sharepoint and SQL Server incuded. The server performs a scheduled backup of itself on the backup disks, while keeping the last twenty backups available. 

[update: minor typo fixes, as usual :-)]