How practical would it be to build a small machine with a 200-500mW laser diode for things like cutting shapes out of paper and perhaps thin styrene?

Also, what kind of software and electronics would be good for a casual hobbyist? There is no lack of 3 axis CNC controllers but I'm not sure what I should be looking for when I only need two axes and a laser. Ideally I would like to be able to send some basic vector drawings to the machine and have them cut out of paper.