Has anybody plaid around using lighthttpd on a server being use for a CMS w/ heavy traffic? What sort of performance gains did you see? What were some of the problems you ran into?

I'm running a Drupal 5.x site on a server that is definetely RAM deficient. Having a whole bunch of 15-20MB apache proccesses running is a real quick drain on my RAM. I love love to scale back on apache connections a bit and use lighty to serve up the static content on the site (images, css, etc...) Does any of Drupal's caching mechanisms get in the way for this?

yes, lighthttpd will help out with dynamic content however make sure you have enough ram - 1GB.

I've used Lightty on vBulletin powered forums which is very dynamic. I wasn't too impressed with it's performance and we kept running into a few annoying bugs. I think once the 1.5 series gets out of testing we will have a much better picture of where Lighttpd stands compared to apache.