Removing Active Directory from that server computer, assuming that you have other domain controller computers, is a straightforward process. (If it's the only domain controller in its domain or forest then you need to ask yourself some questions re: whether or not that particular domain or forest needs to exist.)
In Windows NT 4.0 you had to "repave" machines to change their role. Since Windows 2000 it's been much easier.
(If you've installed SQL Server 2005 on the machine already there can be some minor issues that will need to be addressed after the demotion. Assuming you have not, proceed.)
- Start / Run / dcpromo
- You will be prompted to remove Active Directory. Take default choices throughout the domain controller promotion / demotion process, being sure not to indicate that this is the last domain controller in its domain (unless it really is and you're really sure you want to do that).
After the machine completes the process and restarts it will be a non-domain controller member server in the domain it was previously acting a as a domain controller within.