I really like using the Drupal CAPTCHA system with ReCAPTCHA (the one that helps scan in books). Both of them suck in the standard “Drupal makes everything ugly and hard to use by default, but it’s still easier than building something from scratch”.
One of ReCaptcha’s problems is that the words are sometimes hard to read. To deal with that, I used this tip from a Stumbleupon developer in the comments of this post entitled ReCAPTCHA’s quality is going down? : putting a link to reload—Recaptcha.reload()—the CAPTCHA in the explanation. To do that, I pasted this into the Challenge Description setting on the CAPTCHA admin page:
I also used CSS to hide the fieldset border box and title from the comments to cut down on the cruft too.