I know perfectly what a Firewall does and how different firewalls work. I even have written a Firewall. I'm the author of bastion-firewall for Linux. And I am also Telecom Engineer, so I know how the OSI and TCP/IP stacks are designed. Anyway I checked your link and I find it very interesting. I have bookmarked it to send it to some people that will be interested in this things.
Of course:
I use a PFW also with my XP at home, so I basically agree with your words. And I know a PFW can be used to protect a home LAN, but then it's best feature, that it's controlling access of applications to/from Internet doesn't apply to the LAN computers. I would find it more useful to have one PFW on each computer if you really want to use PFW.
Yes, I was talking about something like the Pix 501, a low cost router and firewall. Anyway I find useful the PFW to stop things like spyware or worms that use standard ports like 80/tcp and can't be easily stopped with what I call "real" firewall. That's why I say they are different things and serve for differents purposes.
Regards.