There is a software product called "Screen Recycler" that lets you use another computer to create an extended desktop. It uses the VNC protocol, though, and is dirt slow. (Don't believe the demo video on their website. It lies.) But if you just want to hold some Photoshop palettes or something, it will work.
(I tried it over Gigabit Ethernet between a 2.0 GHz MacBook Pro (the 'main' machine,) and a 2.0 GHz MacBook (the 'extra screen' machine,) using Chicken of the VNC as my VNC client on the MacBook, and it was still only about 1-2 frames per second. Over any slower network connection, and it became 'seconds per frame'.)
Still an interesting idea. If only they used a custom protocol that, instead of transmitting the whole screen as images (the way VNC works,) transmitted the INSTRUCTIONS for drawing the screen (the way Citrix or Microsoft's Remote Desktop works,) it would be at least passably usable.