It certainly does make sense to move more conservative investments as you approach retirement, but do not think that you need to leave stock entirely. And also, you need not make your retirement income purely off of dividends/interest, etc.

Typically it is suggested that you limit your annual withdrawals to 4% of your balance. Doing this with a portfolio of 50% stocks/50% bonds, over the history of the last century or so, you never would have run out of money (that doesn't mean you can't, but its what we got :) ). The bonds provide good income and the stocks provide the growth you need going forward.

In other words, I wouldn't feel bad about using some of your principal, so long as your withdrawals are low enough, and so long as you maintain enough in stocks to continue to benefit from their growth.

You may wish to check out this:
http://www.retireearlyhomepage.com/
and this:
http://www.retireearlyhomepage.com/novtips.html