website restriction

Better to get some sort of appliance but if you want a quick fix you can make some entries in your DNS --> Forward lookup zones   Right click --> New Zone --> add the web address and a bogus ip for it to point to  IE 10.10.10.10     It is pretty easy to get around if you know how to do it but for most basic users it will do the trick while you find a better solution.

Watchguard equipment is pretty easy to manage once it is set up.

http://www.watchguard.com/products/xtm-2/overview.asp

Run you $300 for the device and probably the same for a networking company to set it up.

Nice thing is it is very easy to manage if you are willing to read the instructions.

We use barracuda, works great with ldap.

http://www.barracudanetworks.com/ns/products/spyware_overview.php

I do Squid(Free)! I'd recommend running Squid with Dansguardian ....squid is the best but keep in mind it requires times and skills to install, manage and configure it with other components. I used it in many complex environments with success but again you need  the skill in Linux and squid (open source packages)...

check these documents too
http://www.linuxhelp.net/guides/squid/
http://wiki.squid-cache.org/
http://wiki.squid-cache.org/SquidFaq/SquidAcl#head-926288cb0cbbdea92bc4a807f06dd75ddbc446ff
http://www.linux-magazine.com/w3/issue/100/052-054_squid.pdf
http://www.linux-magazine.com/w3/issue/72/Squid_Bridge_HTTP_Proxy.pdf

Use comodo DNS,  norton DNS or openDNS services. Run or your clients PC http://www.prevx.com/


also you can check

K9
http://www1.k9webprotection.com/
Block web sites in more than 70 categories, including pornography, gambling, drugs, violence/hate/racism, malware/spyware, phishing
Force SafeSearch on all major search engines
Set time restrictions to block web access during designated times
Configure custom lists for "always allow" and "always block"
Override a web page block with password
Trust the enhanced anti-tampering, even children can't break
View easy reports to monitor and control web activity
Real-time categorization of new adult and malicious sites
Best free parental controls software/internet filter available


http://www.untangle.com/
Untangle provides a powerful suite of Internet management applications for small-to-medium businesses and education institutions.


http://www.iambigbrother.com/
IamBigBrother is the leading internet monitoring software available for both homes and business. And when using IamBigBrother, you'll know exactly who your kids chatted with last night and be able to read the full conversation!

http://www.refog.com/download.html
REFOG Employee Monitor is the ultimate surveillance suite offered by our company. Having all features of our less advanced products, REFOG Employee Monitor is designed to boost productivity of your employees. The product can watch multiple PCs and workstations at once without leaving your chair. Instant alerts are handy to prevent information leaks the moment they are about to happen

http://www.eblaster.com/
eBlaster spy software is the ONLY software in the world that will capture their incoming and outgoing email, chats and instant messages - then IMMEDIATELY forward you an EXACT COPY.

http://www.websense.com/   WebSense Web Filter

is there any tool for server 2003  to monitor the internet traffic and huge download for each client connected to server ?

that gets a little more complicated. the biggest factor will the type of switches you use, if you have cisco, net flow is the answer to your problems. you need to look into a network management software, we use spiceworks for some info, very useful and its free.