When I was connecting my department to the internet in the early 90s, I used a small floppy-based Linux distribution to serve as our firewall (yeah, CISCO is expensive then and still is now!). It worked pretty well for several years until affordable routers flooded the market. However, not all routers provide you with the power and flexibility a Linux device can give you. One of such devices can be configured by using Devil Linux, a specialized Linux distribution that functions as a router/firewall. Like the floppy-based distributions I used a couple of years ago, this one also runs off the floppies, in addition to CD/DVD and USB thumb drives.
So why don't you give it a whirl and see how it fits your network?