First Time HTPC

Hello everyone!  This is my first post here.  As the subject says, I’m building my first ever HTPC, though I have built at least 10+ regular PCs over the years for myself and various friends/family.  I have a good idea of what I want to do, but I’m hoping for some guidance from a home theater point of view in case I make the wrong decision. 

First, let me explain my situation.  I just bought a brand new LCD tv (Sharp AQUOS 52″ LCD – LC52D64U).  This is replacing my housemates 3 year old 46″ Panasonic DLP tv that only supports 480i/p and 1080i (Don’t ask me why it completely skipped 720).  As far as audio goes, I currently have a Sony STR-DG500 5.1 receiver that outputs to a set of wall-mounted 5.1 Logitech speakers (Actually it’s Logitech satellites paired with a Monster Audio subwoofer.)

Other devices I have are a Dreamcast, PS2, DVD player.  I eventually plan on getting a xbox 360 w/ HDMI and maybe a PS3 if Blu-ray takes off.  A housemate occasionally needs to plug his Gamecube and Wii into the tv/receiver. 

I have a large collection of mp3s and video files on a networked PC in another room.  My entire house is networked, including the living room.  I also have a Western Digital MyBook World Edition II (500GB, basically a NAS).  I want to archive the mp3s and the older videos on the HTPC, the oldest videos on the NAS, but the newest videos and mp3s on my desktop. 

I also have a digital cable box.  I haven’t decided if I want to push my cable through my HTPC or just straight through the TV (basically do I want PVR functionality?)

My plan is to take parts from my current PC (built in July 05), buy some extra parts and create a new high-performance desktop and a second HTPC. 

[b]Here are the specs for my current desktop:[/b]
Case: Lian Li PC-12 Silver
Power Supply: Antec True Power II 550W ATX
CPU: AMD Athlon64 3000+ (1.81Ghz) 939pin venice core
CPU Fan: Arctic Cooling Silencer 64 Ultra
Mobo: MSI K8N Neo4 (Nforce4 SLI) – (6 SATAII, 3 PCI, 1 PCI-E x1, 2 PCI-E x16, Gig-Ethernet, Firewire 400, RAID supported)
Memory: 2GB Crucial (4x512MB) DDR 400 (PC3200)
Video Card: chaintech se6600G Geforce 6600GT w/ Component/Composite/DVI out
Sound Card: onboard Creative Sound Blaster Live! 24bit (5.1, digital/optical out, 96KHz/24-bit) no dolby interactive content encoder
Hard Drives: Hitachi T7k160 160GB 8MB cache sata2
maxtor maxline III 7l300s0 300GB SerialATA150
CD/DVD: NEC 16x DVD+-R IDE ND-3540A
Pioneer 120S (or 106S?) slot load dvd (broken?)
Misc: 2 Logitech Gamepads

Some notes:  It feels like my Pioneer slot loading DVD drive (which is at least 5 years old now) is on its last legs.  I really like the slot load feature and I would love to have it again in both my new desktop and my HTPC.  The Plextor slot load burner intrigues me, but it is a bit pricey.  I also read that in March Plextor announced a slimline to 5.25″ drive bay convertor (PX-DB600) but I have yet to see any kind of retail availability. 

I’m also concerned with whether my current CPU fan will be quiet/cool enough in my HTPC.  Right now it runs perfectly fine for me so I hope that will continue. 

[b]Now my HTPC plans:[/b]
My budget is about $2000, but I’m willing to go above (or below) it as necessary.  To me, if a product shows good “value” at its price, especially if it’s a product that I can keep for several iterations, I’ll pay a price premium.  (I’ve kept my Lian Li through 3 desktops and 7 years). 

The purpose of my HTPC is 1) to learn how to make a HTPC and 2) play video files and MP3s on my TV, maybe eventually some roms and simple games, and do some general web browsing. 

[b]Case: [/b] ZALMAN HD160XT-B Black, $550ish
I love this case, but it is EXTREMELY pricey.  In order to justify this I would have to make sure I could take full advantage of the touchscreen in front to play videos.  And ensure that the case would be future proof for at least 5 years.  Also the fact that it is black presents a slight problem since all my current drives have silver faceplates. 

[b]Power Supply:[/b] ZALMAN ZM600-HP ATX12V 600W, $150ish
This power supply seems pricey but all the reviews of the case I read used this one.  I like that it has a heatpipe and that the fans work with the case to produce proper airflow (something to do with the top fan and the back fans blowing in/out).  But I would much rather be spending about $90 for my power supply. 

[b]CPU/Mobo/Memory: [/b] Taken from my current PC.
CPU: AMD Athlon64 3000+ (1.81Ghz) 939pin venice core
CPU Fan: Arctic Cooling Silencer 64 Ultra
Mobo: MSI K8N Neo4 (Nforce4 SLI) – (6 SATAII, 3 PCI, 1 PCI-E x1, 2 PCI-E x16, Gig-Ethernet, Firewire 400, RAID supported)
Memory: 2GB Crucial (4x512MB) DDR 400 (PC3200)
This should be fast enough but I wonder if the fan will be quiet/cool enough. 

[b]Soundcard:  [/b] Taken from my current PC
Sound Card: onboard Creative Sound Blaster Live! 24bit (5.1, digital/optical out, 96KHz/24-bit) no dolby interactive content encoder
I’m not much of an audiophile (yet!) so I think this should do for now.  Also the content I have isn’t of the highest quality (yet!) so higher audio capabilities isn’t crucial. 

[b]Video card: [/b] MSI NX8500GT-MTD256EH GeForce 8500GT 256MB PCI-E x16 HDMI/DVI/TV out,  Silent Heatsink, $80ish
So I would use the DVI to drive the lcd on the case and the HDMI to drive the TV.  I like that the heatsink is silent.  I would be fine with using my old video card if it could support HDCP.  This one I’m not too sure about.  I’ve tried using regular desktop PCs with my current TV (the Panasonic, 480i/p and 1080i) but the display always looks “fuzzy”.  (Is this overscan?)  How can I be sure I don’t get this with this card?

[b]CD/DVD:[/b] ?Lite-On 48x Black DVD-ROM 2MB cache DH-16D2P-08?, about $20
I’d like to get a slimline slot load drive and use the Plextor bay mentioned above but I don’t know how viable that would be with the case.  If not, I’d just find the best value in a black dvd player.  (I want the tray to be black as well.)  I wonder if DVD is the right way to go with this.  Is blu-ray or hd-dvd going to take over soon (within one year)? 

[b]Hard drives:  [/b]
If I don’t go the PVR route, I think that my old hard drives would be enough.  (160GB + 300GB)
I also wouldn’t mind getting the HITACHI Deskstar 7K1000 750GB ($200) and/or the WD Raptor 150GB($185), but I would also want those drives in my new desktop.  Plus with the 500GB NAS I have, I don’t really think I need more space.  The question is whether the MCE software (I think I would use Windows XP MCE) could access files on the NAS. 

[b]Misc:  [/b]
If I go PVR, I’ll get a TV tuner.  Any recommendations?
Mouse/Keyboard:  Hopefully the included remote (with the case) does most of the things I’ll need, but if not, I really like the BTC 9019URFIII.  Any opinions?  Any keyboard I get would need to be wireless with an included mouse/touchpad.  Also it would have to work in conjunction with the remote. 
Remote:  Included, but would a Logitech Harmony be better? 
Gamepads:  From my old PC. 
OS:  I plan on using Windows XP MCE unless anyone can suggest a better setup that’ll be simple for a first timer like me and very functional. 

[b]Extra concerns:[/b]
What are the various drivers/apps I should get to make my experience much better?
Are there any other things I should consider doing with my HTPC?

[b]New Desktop: [/b] 
I haven’t really fleshed this out yet, but I think I’ll be going with an Intel C2D CPU, an 8600GTS (or 8800 series if nvidia releases the 9xxxx series), 4GB of RAM (vista-proof), Raptor HD + Large storage drive (preferably a hybrid with built in flash memory if those drives ever make it to retail), my old DVD-burner, and hopefully onboard sound

If you’re still reading, let me just say sorry for the long post and thanks for reading through all of it and for any help you give me.