Short list of useful Linux distributions

For Desktops:
  Ubuntu (and siblings) - Good hardware detection and configuration.  As a decendent of Debian, has a LOT of packages available.  Also offers the proprietary packages that Debian won't touch.  One weakness I've noticed, is that Ubuntu's Samba is not compatible with Geexbox (see below), not sure why.

For Servers:
  Debian - Excellent for a large number of tasks.
  Ubuntu Server - Almost as good as Debian, and as a decendent of Debian gains almost all of it's strengths, but has the same Samba weakness as Desktop Ubuntu when sharing to Geexbox.
  Gentoo - Phenominal for getting the absolute best out of a machine... if you're willing to put the time in to get the system running, which arguably can be a headache.

For Routers:
  Smoothwall - Great for user friendly setup and maintenance.
  IPCop - Slightly less userfriendly than Smoothwall, but includes more advanced features, which can confuse even me at times.

For Media Players:
  Geexbox - Usable as a customizable live CD.  Can read Samba and NFS file shares, though has difficulty seeing/dealing with Ubuntu based shares (not sure why).
  XBMC Live - Xbox Media Center.  Great of features, but unfortunately requires advanced 3d hardware more advanced than the GeForce2MX that's in my media player box.

For File Serving/Storage:
  FreeNAS - absolutely beautiful, a little detailed to set up, but easy to administer.  Big giant gaping weakness, because it's BSD based, it likes UFS filesystems which don't handle power failures gracefully at all.  Damaged filesystems, machine boots, then goes zombified with trying to make heads or tails of the filesystems.  So to repair the system, you have to boot a different live BSD distro, fix the filesystems, then reboot back into Freenas.  Great for administration... if you never EVER EVER have an unanticipated power failure.

Everything else:
  KNOPPIX - One of the best Live CD's ever.  Without KNOPPIX, I'd probably still be fighting Windows every day to get anything done.  Excellent for learning and getting comfortable with Linux before taking the big step of doing a full install.  Also great for bringing a system up for doing repairs or just to copy information from the hard drives to somewhere else on the network.