Peter, Check out the following article from WindowsNetworking.com
I'm planning on doing something similar on the network I'm setting up in a hospital, mostly to keep people from downloading executables, but also to limit the amount of junk they are putting into the file server.
I'm trying to control what types of files our users can place on our space constrained file servers....such as preventing storage of jpg, mp3, etc files. I don't want to run a script and delete the files after they've been stored on the file server, rather I'd like to prevent the users from being able to store them on the file server at all. Can this be done by group policy?