Fontforge is a great free program, it's just as good as Fontographer. (only, better, because it's free!) You can do quite a lot with it, such as remove overlaps, scale outlines. You can even use it to convert PostScript fonts to TrueType and vice-versa. The only catch is, it's written for Linux, so it's a real pain in the ass to get it to work if you're running Windows. Other than that, it's great!
The two fonts I've posted here, Sharps GF and Fireye GF (you can find them in the resources forum), were made with it.
Homepage --> fontforge.sourceforge.net
A tutorial for installing it in Windows is located here: http://s9.invisionfree.com/Azure_Echo/index.php?showtopic=72