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[From comp.home.automation with additions by poster]
>I was told CAT5 could be used for this purpose. Is that correct? Anything I
>should be concerned about?
Yes, but you need to watch out for the current capacity. CAT5 isn't very
heavy gauge and it can't carry much current. Anything above an amp is probably a bad idea. You can double up pairs to increase the current capacity though.
The other thing to watch out for is voltage drop. Small gauge wire has a higher resistance per foot so the longer your run and the smaller your wire, the more voltage drop you will see. Thus you might lose a few tenths of a volt by the time you reach you destination.
I also put a 0.1 mfd capacitor at the end of a long run, just to kill any
noise there might be. Putting an 18V or equivalent MOV/Surge Suppressor across the 12VDC supply on BOTH ends is also a good idea since long runs are magnets for induced transients.
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Home Automation FAQ : 
Can I use CAT5 wire for audio, temp sensing, etc. ?