LOOOOOOOOOOOOVE, LOVE, LOVE emblibrary and ATW, used to be an embroidery DK subscriber too, but I just wasn't feeling her stuff lately....I'll be back though!
here is a site that has a free design search engine:
www.search4designs.com
Ummm, stitch it cheap, she has a yahoo group where she posts free designs and she has a subscription service too, nice stuff.
Also...designs by sick....couple of yahoo groups and with the one a free PES design per day.
Couple of good free format changing proggies out there so don't worry if your machine doesn't take a certain format!
Anna