Here's a very cheap, but efficient setup:
Two old Pentium IV or above computers with 1GB or more memory. Old Compaq, HP, Dell or Acers work perfectly. Should have on board Network card, Sound, vga, usual stuff. Just two normal desktop computers.
A switch/router/whatever to connect the two computers to your home network. Not wireless, because streaming sucks on that.
If you want Full HD streaming, make sure your network is 1Gigabit and not 100Mbit. If you want to display full hd make sure your tv can and your video card can display 1920x1080 pixels. Note that Full HD is pretty resource consuming, but HD (720 pixels) is possible on almost any cheap ass Pentium 3 hardware
One PC has to have a SATA connection (doesn't really matter which one, but Sata 2 would be nice) and should be able to boot from a USB stick.
a 2TB Samsung SATA Ecogreen F4 harddisk (this is a cheap ass 2TB drive, you are free to use any drive you want of course)
Old 1 GB USB Stick, as long as you can boot from it.
Burn FreeNAS iso to cd-rom.
For PC 1:
Put big huge disk into pc
Put in USB stick into pc
Boot pc with FreeNAS cd
Install Freenas on USB stick
Reboot PC1 booting from USB stick
note ip adress
remove keyboard, mouse and monitor from PC 1 and put PC 1 somehwere safe with enough spare room to make sure it cannot overheat. This computer will run 24/7 being your big media vault.
For PC 2:
Just keep and/or install Windows XP on it. (Or Gentoo, Or XBMC, Or mythbuntu, whatever, but personally i think Windows XP works perfectly
Connect VGA or DVI or HDMI to your television
Connect Sound to your surround set
Use your browser (mozilla works best) to configure FreeNas on PC1 using noted ip adress.
Make a network share to your FreeNAS on PC1
Enjoy watching/playing anything from PC1 on your PC2 (and thus on your television) using VLC media player or some other piece of free software to your use.
There you go. Your own media center system using cheap ass components.
If you want more security, stability, performance, backup, etc, you need better and more hardware of course.
If you configure and maintain your cheap FreeNAS PC1 correctly it can be your:
- media center
- streaming server
- file server
- web server
- torrent server
- itunes server
- printer server
- ftp server
- backup server
- user home directory server
If you configure and maintain your cheap TV PC2 correctly it can be your:
- Internet on your television computer
- Media Center
- Entertainment center (videogames on your big screen)
- Read/watch/play/stream any kind of pod- or videocast from any site everwhere
- Radio (shoutcast, icecast, local radio station website)
- Television channel (Netflix, Hulu, Youtube, whatever)
- Connect a good webcam (with microphone), install Skype and your television system just became a huge videophone
- Connect a tv tuner and your pc might become a TiVo (this is very difficult!)