The Ultra 5 was Sun's first real attempt to compete with powerful low cost PCs. Introduced in January 1998 at an outstanding price of $2,995 (without a monitor), it quickly became an incredibly popular Unix workstation. Considering that the slower Ultra 1 had cost nearly 10 times as much only three years before, it was obvious the Ultra 5 was aimed directly at enthusiasts, colleges, and other places that wanted Unix workstations but couldn't afford the ridiculous markups of the traditional workstation market. And it worked, they were snapped up by the dozens or even hundreds as every dot com purchased legitimacy through nice workstations, Aeron chairs, and whatever else they could blow VC money on, driving Sun's stock price up to stupid high levels in the process. And now, thanks to the massive fire sales in Silly Valley after the crash, you can pick them up for $50, or $20 if you're buying bulk.
The reason the price was so low was because the Ultra 5 was, compared to other workstations, cheaply constructed with commodity equipment. Instead of SCSI and SBUS, the Ultra 5 used IDE, PCI, and a cheapo ATI video card. In fact, the only thing distinguishing it from a standard issue x86 box is that instead of a Pentium II, it had an UltraSPARC IIi running at between 270 and 440 MHz.
Despite this, the Ultra 5 is actually a well constructed machine, and certainly easier to work with and more reliable than a Dell; it just can't compete with a Ultra 2. The Ultra 5 includes a Sun-standard Happy Meal Ethernet chip, support for a serial console, and can take up to a gigabyte of memory.
Physically, it follows the pizza box form factor so common among Sun workstations, and looks a lot like the earlier Ultra boxes. You can run Solaris, Linux, FreeBSD, OpenBSD, or NetBSD on an Ultra 5. At the moment the best Linux distro for UltraSPARC is probably Gentoo, though a few others are still supporting it. Due to a strange controller design, only Solaris supports the built in floppy drive. The older BSD-based SunOS does not run on any of the 64-bit systems, even in 32-bit mode. They are still easily fast enough to be a decent workstation or server, and reliable enough to trust with the job.
The Ultra 5 was discontinued in 2002 to make room for the new Sun Blade workstations, which closely follow the Ultra 5 design philosophy.