I think that games that were originally released as freeware and games that were originally for sale but later were made free are different things and should be listed separately. Obviously once-retail titles are going to be much bigger-budget, etc.
That said, some games that always were free which I like:
DOS: Arcade Volleyball, 3-D World, Castle Adventure, Star Goose, Bananoid, SIEGE!, Mario!!, Bombs and Bugs, Pong Kombat (for the amusement factor more so than gameplay), EGA Trek (I think it's freeware?)
Windows (any ver.): Hydorah, Ninja Senki, N, Guxt, Cave Story, Torus Trooper, Gal Pani X, GLtron, A7XPG, Battle for Wesnoth, Gunroar, Parsec 47, Noiz2sa, rRootage, Warning Forever, Castle Attack (Stronghold promo minigame), XEVIL
Flash: Nanaca Crash, that Winnie the Pooh super-impossible baseball game, http://www.gamedesign.jp/flash/mahjong/mahjong_e.html
As for games that were originally retail or shareware games but later got made free, there are lots of great ones, I'[m not going to try to list them all. To mention only a few, all titles I have actually played the free version of (so I'm leaving out those Blizzard games since I have retail copies of those games; Lost Vikings is a favorite of mine!):
DOS: Dark Ages, Llamatron 2112, Traffic Department 2192, Beneath a Steel Sky, The Elder Scrolls: Arena, TES: Daggerfall, Jetpack (PC), Chex Quest, Galactix, Skyroads, Tyrian 2000, Major Stryker, Overkill, Pharaoh's Tomb, Monuments of Mars, Arctic Adventure, Sango Fighter
Windows: Castle of the Winds, Death Rally, Dink Smallwood, C&C: Red Alert (if it's the Windows veriso nthat's free and not DOS?)
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