Here is my thought on the subject. I have used both PHPBB and SMF quite a bit and here is the breakdown of the two.
PHPBB
PROS
FREE!
Easy To Use
Nice Free Skins
Nice Free Mods
CONS
Mods Take A Lot Of Install Time
Not As Powerfull As Other Boards
SMF
PROS
FREE!
Easy To Use
Great Interface That Resembles VBulletin
Templates And Mods VERY EASY To Install
CONS
Mods Really Only Work On Default Skin
Almost Every Template Looks Like Garbage
I prefer SMF just because the interface is better. However you will have to skin it quite a bit to make it look good. PHPBB on the other hand is very easy to make look good but just isn't as powerfull. You would need a lot of timely mods to make it even compare to SMF.
I've used PHPBB since day 1 and couldn't be happier. I played wth SMF on my sandbox site for awhile, but just never could make myself like it. PHPBB has a massive user-support community with alot of really cool ppl in it too, so finding help on PHPBB is easy.