Overkill is definitely an understatement..
First off, a "real" Cisco router is designed to be just a router out of the box. It can do NAT, etc. but it doesn't really have a lot of the firewall features you might want, unless you purchase a multi-thousand-dollar piece of software, firewall feature set.
If you're not familiar with Cisco and networking this probably isn't the project for you. It'll take you a LONG time to get it to work right. Simple features like NAT, DHCP server, port translation, etc. that you can easily setup on a SOHO router will take days to research, figure out and play with. Security is another gotcha - Unless you're VERY careful you'll have huge security holes in your setup.
In reality, a good SOHO router is much better at doing what it does. It bundles together all the features you really need into a small, cheap, easy-to-manage package.
If you want to play with the router, I'd use it in a lab-type environment and experiment around a bit.
- G