I'm using the arduino to program an attiny26 right now, it acts as an stk500v1 and works perfectly, should program all the AVRs.
>Go
here for more, you would have to change some things depending on what chip you have, but avr dude's error messages tend to be clear.
The arduino itself is really powerful, which can be overkill for some projects, so it's not a bad idea to have a few attinys around, the arduino can be a programmer one minute and a prototyping platform in the next
