I went single speed on the cheap with my junky old steel-framed mountain bike. I was using the derailleur as a chain tensioner but it was big and bulky and noisy, so I got a chain tensioner from
Misfit Psycles. It's a nicer, lighter-weight device, but it has a major design flaw: instead of pushing up on the chain and ensuring the best contact between the cog and the chain, it pushes the chain down, away from the cog, which was causing skips. So, I took out the tensioning spring and on their advice zip-tied that sucker to the chainstay, for maximum wrap-aroundage, and I think it's going to work out pretty well.