Are there any free 3d modelling programs for linux? Preferably one that can handle md2. Thanks.

Blender does.

i've used Art Of Illusion for a very short period and it seemed pretty ok. it doesn't have support for md2 though (that i know of). personally i can't stand blender.

You might want to check out Misfit Model 3D (mm3d for short). I stumbled on it just yesterday and from what I saw this far, I must say I liked it. It supports md2 and ms3d, both read write. It even supports skeletal animations!
I haven't tested it though, yet. But if it makes me stop rebooting into windows just to use milkshape3d, it 'll be perfect for me!

HTH,
Yiannis.

Have you tried ac3d, I think its at http://www.ac3d.org

Not sure if it can handle md3 models