Thanks to everyone who has posted ideas, suggestions and comments so far- I've just finished reading them all now- much appreciated and very interesting stuff.
A few points that I should've mentioned in the original question are that (as most of you correctly assumed being a UK school) nearly all clients are Win XP SP3 with the odd exceptions of a few Vista, Linux and OSX machines. I say migrating to one server but of course that would have a back-up machine- its just that at the moment we have this crazy configuration of two physically separate networks/domains with their own DCs, switches, ISPs etc- one for students one for staff. I inherited one helluva crazy mess, indeed! What I mean is that all this is going to be amalgamated into one physical network and one domain, not one server.
We don't use Exchange so AD/Exchange inter-op isn't a requirement or an issue.
I was aware of eDirectory but didn't mention that in the question because its not FOSS- however this has been recommended much more than Sun's solutions and Apache hasn't even had a look in. I don't want to rule Novell out as a possibility as it may just be better a better long term solution than sticking with AD/2003. It would seem FDS/FreeIPA is the only serious FOSS solution available for this right now
Of course, AD *should* logically be the easiest one to stick with/ 'migrate' to but that doesn't necessarily make it the best choice. I think we'd be more than willing to hire a consultant to help transitions to an alternative if there were numerous long term benefits.
I'm going to have a play with FreeIPA on a small network of test machines or under VirtualBox and see how that goes first I think.