As Jon notes, L3 switches often can do more than just route. I wanted to add they are often "feature impaired" compared to the software routers. This limitation doesn't apply to just the "little" L3 switches (e.g. 3560), it can also apply to the "big" switches, e.g. 6500/7600, too. For instance, QoS on a 6500 with LAN line cards isn't as quite as feature rich as on an ISR's. Or, 7600 doesn't currently support being a PfR master. The reason for this, the L3 switches are trying to perform all their primary functions directly in dedicated hardware, for speed, and they don't have enough of it to support all the possible IOS features.
