Too many to choose from. Here's three relatively obscure covers that I like.
Judas Priest does a great version of "Diamonds and Rust" by Joan Baez on their Unleashed in the East album.
Iron Maiden did justice to Tull's "Cross-Eyed Mary" on an import compilation that I picked up many moons ago.
In kind of a funny vein, Marshall Crenshaw released a live album called My Truck is My Home a while back that includes a cover he used to do a lot (not so much anymore), "Knowing Me, Knowing You" by ABBA. It makes a stupid song sound really good! LOL!