Here are some suggestions for software solutions for each of the steps in the milling process. This is a running list of free/cheap open-source CAD/CAM software.
2D vector generation:
Inkscape (Free, Win/Mac)
3D model (& 2D vector) generation:
Rhino (PC is cheap, MacOS is still in Beta and free)
Blender (Free, Win/Mac/Linux)
Sketchup Pro (Free demo, Win/Mac)
BLR-CAD (Free, Win/Mac/Linux) free & open source cross-platform solid modeler. Not easy to use, and very different from most commercial apps.
FreeCAD (Free, open-source, Win/Mac/Linux) Still in eary stages, but looks to be a really strong program in the near future. Easy interface, very similar to most modern CAD programs.
NaroCAD (Free, open-source, Windows only) Further along than FreeCAD, a little more stable, but only runs on Windows. Easy interface, very similar to most modern CAD programs.
Toolpathing (converting models to paths for a tool to follow):
FreeMILL is a pretty good basic toolpath generator for Windows. It's free, fairly limited, but also easy to install & use.
Cambam Free is not open source, but it is free and looks like it may offer more features than Freemill.
Pycam (Free, open source, Win/Mac/Linux) The standalone version of Pycam is totally amazing... the best package I've seen yet. Still a little buggy, but a huge improvement over previous versions.
HeeksCNC Looks pretty good, fairly easy interface but gives some unpredictable results. Still not quite as stable/full-featured as we'd like though.
Zebra 3D is a work-in-progress (ie, free for now) plugin for Rhino. Looks like there's some good functionality.
PartKAM (Free, open-source, online app) PartKAM does 2.5d profiling, pocketing, engraving and drilling. It's what Jack used to cut out his DIYLILCNC panels.
gcodetools is a plugin for the open-source, cross-platform vector graphics software Inkscape.