I have played and written a lot of music in my life that would not have been possible without technology. I'm not a great musician, but technology can fill in the gaps and make a rewarding experience for me and others.
Here are a few free tools I've been using lately that could be used for fun classroom activities. For one, imagine students turning short poems into songs or raps and then using them as their favorite ringtones. They can also make for great background music in videos and podcasts.
Audacity - I'm sure almost everyone has heard of this free audio recording tool. It's not perfect, but excellent for almost all recording needs in the classroom.
Gsnap - This is my best find of the summer. It offers many of the benefits of the famous (and pricey) Auto-Tune pitch correction software, but Gsnap is free. I'm not a vocalist, but this helps me make sketches of my songs that I'm not embarrassed to play for the people who can perform them correctly. It works with Audacity 1.3, so you have to download that version if you want to use the two together. Supposedly you can get it to do the robotic voice effects popular in many songs, but so far I have only achieved a more natural correction, which is all I need anyway.
And this one is unfortunately dead now...
Roc - This is the music creation tool at Aviary. It can be used to easily make basic beats and loops. Check out all of Aviary's tools for great graphics tools too. I didn't have much luck with Myna, the audio recording tool.