I'm trying to motivate a class to learn about some of the common types of services that are run on Linux systems, things like httpd, ssh, ftp, etc. What services should I teach? What would be the most interesting to the students while still being simple enough to work as an introductory teaching tool?
What do you mean by "linux service"? My guess is that you mean run a class about some of the services typically run on Linux machines -- DNS, email, web serving -- in which case your classes aren't about Linux, they're about internet infrastructure.
Who is your target audience? Are they CS students, Windows admins, hobbyists, programmers? If they know nothing about the internet and aspire to be sysadmins or network admins then DNS is a pretty good place to start; it's fundamental to most other services and easily overlooked. Teach them how the name resolution system works, how data is (mostly) decentralized and what problems they can expect to see.
Same goes for HTTP and email: teach them what happens when you type URL into a browser or how your email finds its way to them.
Once you've worked out who you're teaching and to what ends you can figure out how to motivate them. If you're teaching CS students perhaps it'd be a good idea to show how failures in the internet infrastructure should be handled by software, or (maybe going OT) how algorithms are used in the modern internet (ie OSPF uses Dijkstra's algorithm to establish route weights).
I think, like much of teaching, there will be three groups of students:
So I'm going to target the 1st and 3rd by saying make it cool. For the second... well they'll have to do it if they want a grade.
So depending on what service you want to target, pick something cool in it, and get them to do that.