Recently, I tried installing WordPress on my lab PC, Nogzone Mk II. The version I used was 2.5.1, the most recent release. It turned out to be a fairly easy install. I already had Apache, PHP, MySQL and the PHP-MySQL connector installed. After that, I just followed the instructions given here.
Installing plugins turned out to be a more painful process. The plugin I tried to install, WordPress.com stats, needed an API key. I followed the instructions given here to get the API key. They included creating an account at WordPress.com. Not a very painful task admittedly, but it seems to me to be rather pointless. It might be that I'm using some service of WordPress.com, but I can't reason what. It's my own database and webserver that I'm using.
Once I got the API key, I tried using it to activate the stats plugin. However, this required my WordPress install to access WordPress.com. This didn't work as my lab PC can't directly access the internet.
So, in the end, though WordPress is quite easy to install, getting plugins on it will only work if your server can contact WordPress.com.