I habe three refurbished laptops, bought a few years apart, all IBM Thinkpads, a T23, 1.1 GHz Pentium III M, a T43 1.86 GHz Centrino (Sonoma, I think) and a T60 2 GHz Core Duo. All were shipped with Windows XP Pro and I've had no problems at all with any of them, indeed, this is the T43, now running Widows 7 Pro. When I bought them, they were around 2-3 years old and I paid roughly £120 to £200 in the UK. The T23 was privately refurbished by a one man small business and the other two by the company I got them from (Bigpockets).
One minor issue I had with all of them, though not functionally, is that none had the separate IBM maintenance partition on them, just the primary OS partition. First thing I did when they arrived was make two full backups of the hard drives before I did anything else. So far, I've not needed those!
One thing you do need to watch is that you either get the configuration that will meet your needs for your expected life of the machine, or check carefully that any upgrades you might need are still available. Foe example, my T23 would really benefit from a bit more memory but PC133 SODIMMs are as rare as hen's teeth these days and if you can find them, they will cost more than the machine! In the T43, IBM added a few extra commands to the HDD controller to cater for the air-bag protection and so any replacement hard disk had to be IBM certified, or it would flag an error at POST (which you could "F1" through). Lenovo support do actually offer a patch to update the firmware on certain HDD models to add the extra instructions nad certify the disk but patching HDD firmware is not for the faint hearted!
Would I recommend refurbished laptops? Yes but buy them from a reputable supplier - NOT your local computer swap meet! Check the warranty, you will often find they are 90 days, so give the machine a thorough shakedown when it arrives. In my case, I got quality machines, 2-3 years old at 90% saving off the new price. A good deal? I think so, if you are reasonably competent with PC maintenance.