Well, once my band went in to record a 5 song EP at a friend's home studio. He found out that I had tons of experience in mixing and producing, but wasn't familiar at all with computer-based recording, so he agreed to let us record there for free. The deal was, he'd learn some production tips from me, and he'd teach me about using a DAW, and we'd consider it a fair trade.
He had the place set up pretty nice. Had made some efforts about killing reflections, and even had cobbled together an isolation booth. He had some decent mics, and I also brought along several of mine. The problem was the interface. He was using a Behringer mixer that sent the signals into the computer via firewire. So, we had Behringer mic pres AND Behringer AD converters. When it came time for mixdown, he also had monitors made by - guess who? I drew the line here and brought in my own quality monitors. This is where I began to hear that the raw tracks didn't sound all that good. But, I thought it would be "good enough for rock and roll."
In the end, when I got the final mixes home, I realized that, while the mixes themselves were perfect, the sound quality overall was just not very good at all. We had hoped to use this EP to promote the band to clubs, but decided that we couldn't use those mixes for ANYTHING at all, since the poor sound quality didn't make a favorable impression of the band. All that time invested in the project (two or three days of recording for four guys and two more days of mixdown for me) was totally wasted.
The lesson learned is that crappy sound quality isn't a good deal - even if it's FREE!