To break it down to it's simplest terms a home theater PC these days is simply a Graphics card capable of decoding HD/Blu Ray content with an HDMI + HDMI audio output and at least 5.1 if not 7.1 DTS audio. The PC should have a decent amount of RAM (at least 2MB or more) and at least a dual core processor. But that is about it. The actual CPU speed is irrelevant a fairly low speed one will do.
Like anything else faster is better but a perfectly serviceable HTPC can be had running a 2.0Ghz dual core AMD or Intel PC (preferably Intel, they are better at decoding) with 2-4GB of DDR2 800 RAM, an NVidia 210 1GB graphics card, DVD-Rom and your HD's in whatever case tickles your fancy. By this I am saying you can retask an old desktop, or pickup a working PC off craigslist for a song and put it into a nice case with an upgraded graphics card for very little cost.
The second part of the equation is the ever ubiquitous XBMC or rather XBMCBuntu. This is a Linux distribution specifically designed as an 'appliance' distribution. In other words it boots the PC straight into the XBMC home theater application the same way a hard drive recorder boots to a menu. The Linux distro has been designed to install and configure itself in the background. You can log into a desktop if you know what you are doing and it has a GUI (LXDE), but if you don't want to or need to touch any advanced settings then you never will. All of the normal XBMC settings are still available to you anyway.
The one huge advantage of using XBMCbuntu is that time from boot to application start is roughly 5 seconds even on fairly lightweight hardware, it truly works like an appliance, you press the on button and it goes.
*I should clarify the specification of an NVidia card in the above paragraphs. If you are going to use Linux NVidia is more strongly supported, they update drivers more regularly and are compatible with more distributions/desktop environments.
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