I'm an independent, and I've been working from home several years ago. At first it seemed nice, sleeping in and working on my own hours. But there were a couple of things that really started to bother me after a short time:
For one, you can never escape your work place, at least not if you're living in a small, 1-room apartment as I did at the time. That, to me, made it very difficult to stop thinking of work and relaxing after hours.
Then, there's the problem with the little distractions at home. Nobody's looking over your shoulders, and your friends and family know you're home so they think it's okay to call and distract you, and if you're not disciplined, you might even distract yourself. I've noticed this happens a lot more when working at home.
Finally, and this is probably the most important factor for me, I'd miss the interaction with my peers at work. I do not like all of them, but we do laugh a lot and generally have a lot of fun, plus we do exchange a lot of knowledge. And if they're getting too loud or annoying, I just tell them to shut up and it works :)
So, in conclusion, I'd not only not take a "pay" cut to work at home, I wouldn't even do it for more money.