I set up a league on this
site last season but never ended up using it, as the other owners in my league decided to go with Fanball. Commish.tv started last season I believe and allows you to do re-draft, keeper or dynasty leagues, and is still free at the moment, and they made improvements to the service throughout the season. Let me know how it works out if you decide to use it.
If you decide to go with a pay service, I really liked Fanball. They are about the cheapest, and are supposed to implement a salary cap option for the '04 season. Alot of people have said they don't like them here in the forums, but I have nothing but good things to say after 2 seasons with them.