The basic strategy is to run untrusted code (including compilers) under ptrace to disallow a bunch of system calls. It's also chroot jailed, and subject to resource limits and a timeout. There are more details at http://codepad.org/about
Popular code samples are a good idea! I'll add that to the to-do list.
Ah, thanks -- the about link is not so obvious with a really wide screen browser.
Since I think every single person is going to try to do something naughty to your system, a list of the most creative attempts to hack it would be cool too.
You should put up a page of the most popular code samples :) And of course, let people vote them up and down.