Hi to everybody,
I'm working on a similar project as the one shown by Mike, and find this conversation very interesting...
From my point of view, if you put an Arduino next to every light bulb it becomes a really expensive project, so I suggest you to put your devices inside electrical wall boxes, so that you can control more than one appliance at a time.
Security ove Xbee is not easy: I'm facing the same problem, and I'm thinking about using HTTPS over Xbee. Unfortunately, I still haven't found a lighweight libary that handles cryptographic operations upon Arduino.
I posted my project on my blog, and I'm daily updating the post. As soon as possible I'll share my code too, in the meantime I'll be glad to further discuss possible improvements with you all.
If you want to have a look at my work: http://www.bestmazzo.it
Matteo