CASE(1,
IF(ISPICKVAL({!Status__c},"Active"), 1, 0),"Active",
IF(ISPICKVAL({!Status__c},"Inactive"), 1, 0),"Inactive",
IF(ISPICKVAL({!Status__c},"On Hold"), 1, 0),"On Hold",
"")


I hope this helps.

Thanks so much!
Amanda

To get around the ISPICKVAL gotcha, you can use a case which allows you to basically handle every line item in your picklist using one line in the formula field. Here is an example of how I did it with state:

CASE(State__c,”AL”,”AL”,”AK”,”AK”,”AZ”,”AZ”,”AR”,”AR”,”CA”,”CA”,”CO”,”CO”,”CT”,”CT”,”DE”, “DE”,”DC”,”DC”,”FL”,”FL”,”GA”,”GA”,”HI”,”HI”,”ID”,”ID”,”IL”,”IL”,”IN”,”IN”,”IA”,”IA”,”KS”,”KS”,”KY”, “KY”,”LA”,”LA”,”ME”,”ME”,”MD”,”MD”,”MA”,”MA”,”MI”,”MI”,”MN”,”MN”,”MS”,”MS”,”MO”,”MO”, “MT”,”MT”,”NE”,”NE”,”NV”,”NV”,”NH”,”NH”,”NJ”,”NJ”,”NM”,”NM”,”NY”,”NY”,”NC”,”NC”,”ND”, “ND”,”OH”,”OH”,”OK”,”OK”,”OR”,”OR”,”PA”,”PA”,”RI”,”RI”,”SC”,”SC”,”SD”,”SD”,”TN”,”TN”,”TX”, “TX”,”UT”,”UT”,”VT”,”VT”,”VA”,”VA”,”WA”,”WA”,”WV”,”WV”,”WI”,”WI”,”WY”,”WY”,”")

I am working on a project now in which I was planning to use formula fields to map to multiple objects… I never would have expected size mismatch errors. Thanks for the heads up! And for the solution. Brilliant.