An advisory from security group @Stake was just released and it states:
It is possible to cause the the Mac OS X kernel to crash by specifying a long command line argument. While this primarily affects local users there may be conditions where this situation is remotely exploitable if a program which receives network input spawns another process with user input. It is possible to use this condition to dump small portions of memory back to an attacker.
They then state:
Recommendation:Upgrade to Panther (Mac OS X 10.3)
So there you have it, Upgrade or have local users lock up your machine. Local users can indeed be users that have remote access to your machine (with or without your permission)