Sure they do, though a server without a resolvable name is obviously pretty limited. At home here I have little redundancy, but production networks should. I used to run dhcpd on the same server that hosts my local DNS and mail, but it's just easier to let the router handle it, especially since I only buy routers that use dd-wrt like this nice Buffalo I picked up the other day.
I'm also trying to cut down my electric bill. I'm playing with a Raspberry Pi to see how many services it can take over from my ten-year-old Dell server that does DNS/NFS/Samba/Mail/OpenVPN and some routing. I'm a bit unimpressed at the video quality of the Pi compared to my machines with NVIDIA or ATI adapters, so I may not use it at the display end. I can see it as a server with an external drive attached.
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