Oh yea - that's how I build up these little firewall/router boxen here.
Toss in some Fedora substance
Sprinkle with a bit of iptables scripting
Shake to suit and enjoy.
Old PCs are very handy and often quite cheap for this duty. Lots of room usually left over for other netowrking services. DNS, DHCP, HTTP, SSH, FTP, SMTP, etc.....