Your host would most likely just provide you access to sendemail. In other words, if an email is being sent off as a result of someone interacting with UBBthreads, it (your installation of UBBthreads) is most likely generating a mail object and send that mail off through the sendmail server. Most of the work in that case is really being done in the UBBthreads code. Of course, I don't know exactly how UBBthreads works, but that's how most every other web based software I've worked with sends emails. As far as the DB stuff goes, most likely your web host would allow you to create a MySQL database that your install of UBBthreads would use.
IMHO, I don't think the price of UBBthreads is all that outlandish. I imagine the code base is probably pretty extensive. I've never seen an install of it, myself, but I can only imagine. I use PHPBB on my own server like others have mentioned, but PHPBB is lacking in features. For instance, there is no attachment functionality in the basic install of PHPBB. That functionality is only available as an add-on. Assuming you haven't done any customization of the themes available for PHPBB, then the add-on is relatively simple to install. Otherwise, it's a matter of going through all the diffs and applying the changes to all the php files manually -- quite a pain. I like the default graphics that come with PHPBB a lot more than UBBthreads, though.
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