One of the issues with working with Arduinos is the $20-40 cost for a full board when included in your project.
Certain levels of code sketches can be run on a single chip replacement, the ATtiny45/85 chips.
I bought 10 of the larger memory version ATtiny85 chips for $16.00 from Newark with 50 electrolyte capacitors for another $3.00 or so.
MIT’s High-Low Technology has a tutorial:
Programming an ATtiny w/ Arduino
This tutorial shows you how to program an ATtiny45 or ATtiny85 microcontroller using the Arduino software and hardware. The ATtiny45 and ATtiny85 are small (8-leg), cheap ($2-3) microcontrollers that are convenient for running simple programs. They are almost identical, except that the ATtiny85 has twice the memory of the ATtiny45 and can therefore hold more complex programs. We like to use both of them with paper circuits and other craft electronics. To program them, we’ll use a port of the Arduino core libraries created by Alessandro Saporetti and slightly modified by HLT.
More when I get a chance to try this all out!