According to Michael J. Dikkema:
Does anyone have any suggestions for a good X server for Windows? I preferred Xwin32 a long time ago, but haven't had the need for one since. A free one would be nice, but if there's major feature differences, paying for a licence is not really an issue.
I've recently been playing with Cygwin's X server, based on XFree86 (I believe). From a user's perspective, it seems quite reasonable. I'm using it mostly in rootless mode (where each X client runs in its own window, managed by the Windows desktop interface), but it also supports rooted mode, and XDMCP for making your system act as an X Window terminal to a remote desktop manager.
Our local Windows techie set it up, so I've never done the setup from scratch. I understand it can be a bit tricky - certainly not as simple and straightforward as a commercial solution, but it is free, and gives you a whole POSIX-compatible environment (including local shells, ssh, etc.) under Windows.