Simpler and cheaper option for playing digital media
Instead of using a htpc and dealing with the inherent issues a real operating system can have, may I suggest the WD TV live hd plus. The one with an ethernet port and netflix on the box is the one. It will play stuff from a usb device, your network shares, a DLNA server, as well as popular internet content. Plays almost any unprotected format. The only limitation is that anything higher than 48/24 is down sampled to 48/24. It's user interface is good, though not quite as slick as an Apple GUI. The Apple TV is another option if you are already using Itunes. The WD media box is more versatile though. There are no drivers, keyboards, mice, etc. The cheaper ones lack the network capabilities, so if you don't mind copying your files and sneaker netting, you can save some coin. A usb powered external notebook hard drive works great.