VideoPad Video Editor - Free software for your next movie/video project that can be installed on student and teacher laptops.  It has a similar look and feel to MovieMaker - but performs much better on the laptops.

Vuvox Collage is great software for students to generate interactive panoramic collages. Students add photos, text and audio to create interactive displays. They can also embed links to web pages or video. See Vuvox Collage’s homepage for an example. When students are ready to “hand in” their collage, they need only share the web link with you or embed it in a wiki. If you were a fan of Glogster, but had difficulty accessing it at school, this is a great replacement. 

Creaza Cartoonist, like Vuvox,  is an online tool for student-generated product. Creaza is four software applications in one. Students can create mindmaps, comic strips, movies and audio. Simply sign up and login to use the software and store work online. The free version of the software is very open. 

Update (2/2/11)

Xtranormal is no longer a free service.  There is a fee associated with publishing/downloading all work.  Perhaps in the future they will have accounts for education.
Xtranormal
A free online software that you and your students can use to create short films with your own scripts using text-to-speech technology. The user types the script into Xtranormal and produces a film with 3D characters. The free version allows for a maximum of two characters. You can see an example video from a student here.