First, I assume you meant MS anti-spyware.  "MS spyware stuff" is too
broad of a term and describes many of their products.  :)

Most of my home systems run free AVG 7.5 and CounterSpy anti-spyware and
use a huge hosts file as you described.  CounterSpy is good and cheap,
offering multi-PC licenses for home networks:
http://www.sunbelt-software.com/CounterSpy.cfm .

My mother-in-law's new laptop (an early xmas present from me) is running
free AVG 7.5, free Zone Alarm, and a free-for-the-first-year copy of
Webroot Spysweeper I picked up at a conference.

My home PCs right now aren't running software firewalls although I am
considering it.  If I go that route it'll be either the free Zone Alarm
or the Kerio firewall from Sunbelt.

We generally have safe surfing habits (all adults) so the odds of an
infection by some form of malware aren't that great, but there are times
when we go to sites we've not visited before and you never know for sure
if they can be trusted.  Or if a site you do trust has been hijacked.  


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