Marshall - one of the requirements was a distributed source control. Does Tortoise support one of the SVN-based DVCSeS?
Well, the OP asks for distributed VC, then suggests that they didn't choose Subversion because it was hard - not because it didn't fit their requirement. So it would seem that an 'easy' subversion would eliminate the only concern the OP has with it. -Adam
If you have a Windows server around with Server 2003 or higher, SharePoint (Services? I can never remember) is a good no cost solution. It provides simple versioning and basic work-flow.
SharePoint Services looks like a free download it appears - not sure of the limitations though. technet.microsoft.com/en-us/library/bb400746.aspx