Matt,
This is turning into a longer discussion than it needs to be. Code Red attacked IIS on Microsoft NT systems. It came in through port 80, the standard port for HTTP. Unless you configured your router to block all HTTP traffic, any servers on your network could have easily been affected. That is why over 250,000 pc's across the U.S. alone were infected within just a few days. Yes, even those with tight security on their Linksys or Cisco routers didn't stand a chance.
Granted, having a software firewall wouldn't have made much difference either in this case. But there are many cases if I choose to go down the list, that would show why having a combination of a router and software firewall is more effective and actually preferred.
You also seem to dodge the value of being able to monitor spyware activities. Personally, I like to know when Microsoft applications or any other app for that matter is trying to access the internet without my permission. You'd be surprised what you might find...
__________________________________________________
~cdogg
[tab]"The secret to creativity is knowing how to hide your sources"
[tab][tab]- A. Einstein