I have been using LTSP for a while to turn old PCs into X terminals. LTSP works well for a desktop PC that can use PXE or Etherboot. LTSP does not work as cleanly on old laptops with PCMCIA network cards. In these cases, the kernel has to be installed on the laptop hard disk, but the rest of the LTSP installation runs from the server. When upgrading LTSP, the kernel on the hard disk gets out of sync with the modules on the server, and the laptops stop working as terminals.
I’ve been looking for a simpler setup for a laptop X terminal, and I’ve found ThinStation. It is a customizable Linux distribution designed for building terminals. The entire terminal image can run locally, from the hard drive or a bootable CD. The typical image takes up 5 to 10 megabytes. In this way, the server software can change versions, but the terminal is still standalone for its software versions. Thinstation does support centralized configuration files, giving you centralized control of options without linked dependencies.
Thinstation comes with software for several terminal types, including X Windows, VNC, NX, and Windows RDP.