Exactly, while they might not be as powerful as others, there are definitely free versions of these floating around that are more than able.

The GIMP to replace PS: http://www.gimp.org/

Inkscape to replace Illustrator: http://inkscape.org/

Both of these are really good tools and you don't have to worry about any licensing constraints. The only piece of the puzzle that I haven't found an F/OSS version of is for animation.