Linux is increasingly used in Consumer Electronics (CE) devices, in particular in network appliances such as Wifi routers, DSL modems, Network Attached Storage (NAS) servers, IP cameras and other small devices.
Thanks to the GNU GPL license, kernel and application source code for these devices are freely available. More and more device owners are taking advantage of this to develop other uses for these devices. Thanks to the progress of Linux in embedded systems, making its own embedded system is increasingly easy.
Using such devices instead of regular PCs yields many advantages: much lower power consumption, no noise (no fans), built with much fewer materials (small size), and much lower cost (for your purse and for the environment).
NSLU2-Linux - A community of people running Linux on the Linksys NSLU2 device. This device is originally a Network Attached Storage server, featuring a 266 MHz ARM CPU, 8MB of flash, 32MB of SDRAM and a rich connectivity: Connectivity: USB (for attached storage), Ethernet and a serial port. That's all you need in a versatile Linux computer. Many different cool applications are listed by the project.
The NSLU2 device is still available in the shops on all continents, for a very cheap price: approximately 90 € or 90 US Dollars. This makes this device extremely popular!
OpenWRT - A project to run Linux on WiFi routers based on the Linksys WRT chipset. A typical configuration includes a 125 to 200 MHz ARM CPU, 4 MB of flash, 16 MB of RAM, and Ethernet, WiFi, serial port (often) and a USB host port (often).
Devices based on the Linksys WRT chipset are available for sale on all continents, costing between 50 and 100 € / US Dollars. They are very popular too!
In a nutshell, do not buy a new PC for small applications. Reuse your old computers or buy a consumer device on which you can run Linux!