I've been seeing lots of "Vegeta!" from Dragon Ball Z.
First, I gotta say, that Vegeta isn't really a "villain turned hero," he's more of a "villain turned anti-hero." Everything he does after losing his first fight with Goku revolves around pursuit of his own personal power, revenge against Frieza, and, most of all, proving that he is better than Goku. I'd say that it's only at the very end of the DBZ series that he gives all that up and, by my reckoning, could truly be considered a hero.
Second, what about Piccolo?! Unadulterated villain for all of Dragon Ball and the very early part of Dragon Ball Z, but then he morphs into a tried-and-true hero. Also, he's a badass.
I will admit bias, as I am a huge Piccolo fan and I've always felt that the Vegeta fanboys have a tendency to overlook other characters in favor of Vegeta. Even still, Piccolo's my favorite villain-turned-hero.