i did this a while back... worked okayish, but i stupidly chose a case capable of a full size ATX board, so it was a huge beast. eventually it overheated and fried the mobo lol.
if i was doing this again, i'd probably look to build something on the intel little falls 2 mini-itx board, which are cheap and probably powerful enough, at least for non-HD stuff.
here's a link to my old thread on the subject:
http://www.insanelymac.com/forum/index.php...aded&start=PS Since those days, I went XBMC on an Xbox, and now run a hacked AppleTV (a real one) running nitoTV and rtorrent, and am planning to add EyeTV at some point.