You don’t need a full PC to play movies and music. Here is a cheap and unobtrusive appliance designed to do just that.

Luke Monahan wanted to be able to point a remote at his TV and start the music or the movies without seeing a boot screen. A software engineer and a fan of DIY electronics he says, "Better yet, I wanted my wife to do the same and I wanted it to look good while doing it.” Luke’s appliance combines low-power hardware and specialist software to create a small system that is booted from scratch faster than his TV display can warm up. “It plays HD video and music stored on it (or the network) without trouble,” he says.
CPU: Intel Atom N330 Dual Core - $0Integrated into motherboard – see next section.
MOTHERBOARD: Zotac IONITX D Series - from $280This motherboard runs fanless, so noise and dust are not an issue. This also helps when placing the machine in a cramped area. The integrated CPU is powerful enough to perform all tasks required, except 1080p video, but for that it has an inbuilt NVIDIA GPU. Gigabit Ethernet and 802.11n provide fast access to media stored on the network, and an external SATA port for a nearby external HDD. HDMI connectivity is a must for a modern home theatre setup. An unexpected bonus was finding this motherboard had one of the fastest POST times I've seen. It's booting the operating system within a couple of seconds (actually quite difficult to trigger the BIOS setup if you aren't fast enough). And the whole lot fits into a Mini-ITX package: perfect for discreet under-TV package. A cheaper option could have been the N220 single-core version; however, reported testing of this model with my chosen media software indicates that the overall experience is less than smooth.
RAM: 2GB OCZ DDR2 PC2-6400 - $39Probably more than enough RAM, but it's so cheap these days. The integrated graphics card will also use system RAM, so best to have a little extra on hand. I saw no reason to have faster than average RAM in this build.
GRAPHICS: Integrated - $0As for everything else in this build, low power is the key. This integrated card will play 1080p video through HDMI without a fan, without taking up room.
AUDIO: DIY external USB DAC – $ N/AI've already described I'm a bit of an audio nerd. This DAC is built from a design and PCB from Amb Laboratories called the Gamma-1 (y1). The cost is hard to estimate, as I already had half the required components and ordered the rest from various overseas sources. It was probably 8 hours with a soldering iron to get it together. Most people will just use the HDMI and be very happy (I've tested -- it works just fine).
HDD: 30GB OCZ Vertex SSD - $299Lower power, less moving parts, but, more importantly, blazingly fast to boot. 30GB is more than enough for the operating system, and a whole lot of caching: artist pictures, album covers, music and movie metadata, movie posters and fan art backdrops. This drive allows for a cold-to-playing media boot time of less than 15 secs.
HDD 2: Lacie External 500GB - $150I've had this for quite a while and it isn't my ultimate solution for media storage. It currently stores the bulk of my media while I save up for a proper network storage device build. As a bonus it looks quite pretty. Its main fault for this purpose is that it does not spin down on idle without a little bit of prompting from the operating system. It gets quite hot if you leave it spinning all night. I've now set up a script to check if the disk has been accessed in the last 20 minutes and send a spin down command if not.
OPTICAL DRIVE: NoneI used a USB key to install the software, and other than that, an optical drive is unnecessary for the purpose. The case I used only takes slim drives, and they tend to be overly loud anyway.
CASE & PSU: Antec ISK 300-65 Mini ITX Case - $115I found it the perfect balance between a quality attractive case and one that I could afford. The in-built power supply is quite capable of powering all devices onboard - but without the need for a PSU fan.
Unfortunately, most mini-ITX cases that you would want in your TV cabinet are very expensive. The Antec however bucks this trend with a budget case that looks nice and unobtrusive. It has one 80mm case fan, which I have found is quite safe to switch right down to low, however it's not audible even at high. Covering the vents with some old pantyhose keeps the dust out without problematic airflow interruption.
Core system cost : $883
EXTRAS
MONITOR: Sony Bravia 42in – N/AIt's my existing TV, a model from a couple of years ago.
KEYBOARD AND MOUSE: NoneI didn't need one. All administration is done over the network or via the media interface, however it's pretty much unnecessary after initial setup.
REMOTE CONTROL: Windows MCE remote and USB receiver - $40Just a cheap Windows MCE remote and USB receiver.
OPERATING SYSTEM: XBMC Live - $0The software on a media device can make or break it, and for my money the Linux-based media centre OS, XBMC, is the best available for playback. On the technical side it supports just about any codec that can be thrown at it and supports NVIDIA video acceleration. On the usability side it provides comfortable browsing and management of media libraries and easy addition of media sources from the network or local drives.
Finally it just looks great. Check out the Aeon skin (and its variants), but that's just one of about a dozen high-quality skins. Full-screen backdrops, movie posters and cover art provide that extra bling without harming the overall usability. The stripped-down Linux boots quickly into the XBMC program, overall giving the impression of an appliance and not a computer.