consider this:
- cheap Ati VGA for excellent tv out (Radeon 7000/9000 - on ebay or similar) with stock passive cooling
- Hauppage PVR-250 for hardware TV-in and show shifting(great for pIII) - check out HTPCnews.com for great reviews - passive cooling
- samsung 160gb 1614N (and you DON'T need 133 controller, ata 100/ata 66 will work like a charm - especially when watching movies/plaing music/etc) - suspended
- some kind of remote control - it is very important, coz it makes using pc more like using DVD or VCR
- htpc front end software (paired with remote) - simple, on-screen menu driven, try myHTPC (freeware)
- try underclocking nad undervolting your CPU. Your cpu will work just fine, my setup is based on pIII733 underclocked to 500Mhz and passively cooled with PSU fan - previous setup was driven by celeron 300A@450 and it was enought for watching movies (but little to slow for myHTPC)
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most important thing with HTPC is not a hardware, but software - good front end with remote control. Watching movies without using mouse or keyboard is a holly grail of htpc IMHO. And the silent computer...of course
lot of hard work to configure, but a lot of fun at the end