We've had nothing but good luck in moving files to and from our Windows Home Server machine in Windows Explorer, but there's a data corruption bug present that will kill your data if you're writing stuff over the network directly from certain apps. The apps? Outlook, OneNote, Vista Photo Gallery, Live Photo Gallery, Money and some Torrent apps and Quicken/QuickBooks as well. That doesn't sound good. Our advice is to save stuff locally before copying it onto the Home Server. [Microsoft via ComputerWorld]
For home use, a dedicated server is overkill, especially when the cost difference to a PC is nil. Becasue of an HTPC need, I built a machine using Vista HP last year and it doubles as a server - it houses a group download folder, has backups of all the clients' content directories (documents, photos, etc) as well as acts as a medicore iTunes server (the weak link is the inability to really use iTunes as a proper server application).
Linux would have been better, but I like the Media Center. A Lot. The wife approval factor was high when it became a Tivo (sans subscription) as well as a media center (replaced the Xbox media Center).