I have a ATI2900 HD card. You can get the 2600 for few bucks less.
It requires PCI Express slot.
The ATI 2900 has HDMI functionality, althought they still put a DVI connector on it. However, the connector does indeed send video and audio. I think the reason they did that was DVI has locking thumbscrews on the connectors.
I have the ATI connected to the LCD byHDMI switch because it carries both audio and video and keeps the cable clutter down and I can switch between the PC and other HD players.