Microsoft has just released Windows SteadyState. It is a free program that allows you to lock down a Windows installation, and make it suitable for use in a public environment. 
It is actually a major upgrade (So major they renamed it) from an older tool called the Microsoft® Shared Computer Toolkit for Windows XP.
A few features that make it much more attractive than the older version:
-You don't need to repartition your hard drive to take advantage of the hard drive protection features
-User settings have been simplified to a high, medium, and low setting for each account.
-It enables you to import and export user accounts from one computer to another
-It includes a fully-revised Windows SteadyState Handbook
I decided to take it for a quick test drive, and one of the most compelling features is the hard drive protection. 
This is great. Even if a script kiddy takes over my kiosk and vandalizes the thing, I can set it to refresh back to my original configuration after a reboot.
Another nice feature is the ability to hide the administrator account from the welcome screen 
All in all, this program is packed with features, and provides a level of functionality I had only seen previously in expensive third party products.
Best of all, it is free. Download from Microsoft