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#2 is probably the hardest thing to get right. Most modern low-end cards will handle progressive content very well (including 1080p BD decode), but struggle with interlaced content because they don’t have the memory bandwidth or horsepower to properly deinterlace 1080i (HD TV content).
Where at the top-end you’ll end up with a card that has plenty of power, but is loud and puts too much heat into the mix (many HTPC are in a semi-enclosed space) which can shorten the lifespan of the card or other components.