I've been running my main desktop on Linux Ubuntu "Hardy Heron" (version 8.04) for 6 months now, and feel ready to report (if anyone's actually reading this).
For the most part, I would deem this ready for prime time. Especially if all you are going to do is surf the web, create office documents, and consume video/audio you will have no problems.
There are only a couple of areas that are just not easy to do, and I've ended up setting up Windows XP in a VMWare session for these actions:
1) DVD ripping and burning. It's impossible using native Linux tools to rip a DVD and burn it to a 4.7Gb disk. If it *is* possible, I haven't seen the steps or tool that makes it as easy to do as RipIt4Me and DVDShrink on Windows.
DISCLAIMER: I have 4 kids. The youngest is 5. As a policy, I do not let my kids play the original CD or DVD. I burn a copy and let them use that. Then when (not if, but when) they run it over with the Tonka Truck, I just burn another one.
2) Scanners. I have a Visioneer that has been completely useless since the move to Linux. No driver support anywhere. It won't even work in VMWare because Linux doesn't see the device enough to pass it through to the VMWare USB hub.
The other item I struggle with is HTML coding. I really really really like HTML-Kit. It just works for me incredibly well. No editor that I've found has the mix of code display, shortcut buttons, and the WYSIWYG preview. I'm limping along with Bluefish but it's just not the same.
Aside from that though, I'm really enjoying it. The memory usage is far better and I can run more programs in a more stable way than before. Plus the ability to do power stuff when I need it is great.