There are earlier posts here about the same subject.
Hardware (NAT) firewalls only protect against inbound traffic from the internet.
Software firewalls protect against outbound traffic (worms. spyware, keystroke loggers, etc.) as well as inbound traffic looking for vulnerabilities. They also protect you from cross infection of computers on your own lan. Software firewalls are also updated as soon as new vulnerability types are identified.
So if you're feeling lucky and are absolutely positive nothing will ever get onto a machine on your LAN, or if you don't care about a worm with a keystroke logger capturing your credit card numbers, social security number etc and broadcasting out to the web, or if you cut all the floppy, cd, usb hardware and the email accounts off your LAN PC's then sure, go ahead and depend on just the Router's NAT firewall.
PS I do that on one machine on my LAN but the rest use soft and hard firewalls.