The idea is to make "the network" totally transparent to at least one side of the link (presumably, your embedded device side), so that your device sees no difference on its serial port running anything from terminal-like user interface to a custom binary protocol, and thinks it's talking to a serial port on the other end.

Lantronix was one of the early vendors in this market and now has some pretty cool products. The OP is asking for a standalone device server, but Lantronix and others now have some "drop-in" components to design in. For example see http://www.lantronix.com/products/...index.html