It would have to be a very small school. With Moodle 2.6's overhead, I doubt a Raspberry Pi CPU could handle many concurrent HTTP requests.
How about personal, offline Moodles? Moodle in your pocket, wherever you go, no WiFi necessary. Learners can do all their non-collaborative assignments, activities, reading, watching, etc. offline and then sync with the school's master Moodle. Could it reduce server loads at peak usage times? Maybe under some circumstances... learners would still tend to submit assignments, projects, etc. just before deadlines. Mmm...
I think it's already been done with bootable USB drives, i.e. a LAMP stack + GUI + slightly modified version of Moodle.