I work for Rackspace full time from home, and I'm paid the same as I would be at the office. Whether I work from home or not is ultimately irrelevant, because the most important variable of all is loving your job. I work where I do because it is a truly amazing place to work.
That said, volunteering a pay cut is risky business. Your salary is a gauge of how much your company values you, so you should try to get as much as you possibly can.
A few things to keep in mind:
1. If you telecommute, it's also cheaper for the employer (less electricity, water, bandwidth, etc)
2. If you take a pay cut, any time you get a raise it's going to be less than it could have been, since most companies do raises as a percentage of your current salary
3. The downside of working exclusively from home is that it's easier to not get noticed. If you're not getting much face time with your peers, you better be doing some amazing work