I'm always on the lookout for a good bargain on software tools. Using MS Project to run your project management can certainly add up if you try to extend that to the customer.
A good bargain right now is a product called Basecamp. While it is more of a notification process on steroids than a project management system, it packs a lot of simple functionality into a very low price.
The nice thing about it is that you really only have to pay for the number of projects you are running and the features you want. The best thing, is that there is a permanently free version that lets you run one project. There are no limits on the number of developers or customers you give access to your project!
Again, it's pretty limited in terms of features, but it seems to do what it does well. Plus, there is some pretty cool dhtml in there, too. Certainly worth taking a look. I had a project up and running in about 5 minutes.