It is the same thing you are doing Gene. Just using OLD machines vs. Xterms.
You can run LTSP using X-Terms as well. It is all about making exisitng infrastructure last longer and re-use of "good enough" machines.
From the project frontpage:
LTSP is an add-on package for Linux that allows you to connect lots of low-powered thin client terminals to a Linux server. Applications typically run on the server, and accept input and display their output on the thin client display.And in the LTSP FAQ: [link|http://204.182.52.180/fom-serve/cache/1.html|LTSP - Linux Terminal Server Project FAQ Page] explains many things.
It is fairly straight forward to anyone who has setup remote login capacity for support of X-Terms. Things touched on are things as simple as using boot-proms which ones to use with which cards, or howto get the tftp to work properly, using rarp/bootp/dhcp, fixing config issues (specing boot images for specific machines etc...)