This is what my kids used to do with their free time. Now, my family has been cable free for 1 month. So far... so good. My wife keeps telling me, "I don't miss cable at all." My oldest son, hasn't complained, which for a teenager means that he's ok with it. My 9 year old son has probably had the hardest time with the change, because kids in school talk about shows he used to watch. Now he can't join in on the conversation. My 5 year old daughter has made the transition without a problem.
For me, it's been great. I've been watching the olympics in high definition... for free. My wife and I are hooked on a new Starz show called "Spartacus: Blood and Sand", that I subscribe to on Netflix. We also subscribed to the first 3 seasons of "30 Rock".... hysterical show!!!
With less distractions, the house seems more peaceful. We're communicating more. We now watch TV as a family (with the exception of Spartacus), and we have conversations about the shows we're watching. The kids also seem to be playing more with each other.
Overall, I'm thrilled we made the transition. I can't ever see going back to paying for TV.