i have a Mediasmart server... it works great as a server to backup all the PCs on my LAN.. but i don't use it to decode movies on the fly.. it only serves as a big ass disk (currently 6tb worth of 'stuff'
for the actual decoding, i have varying solutions at the TV level. 1 TV -- my main one -- uses a HTPC to do the decoding.. this becomes very important when doing 1080p stuff.. the mediasmart will never have the ooomph to do that, so it just serves up files..
coupled with the My Movies
add-on, it runs seamlessly and i get to watch hi def movies in the windows media center (win 7, vista) software..
over on another PC, i have a SAGE TV box that does much the same thing..
there are other very small decoder/players out there.. popcorn hour is one that really works well.. xbox360 (with tweaks) works very well also
soooo.. your mileage may vary, but that's how i've done it ever since the hp
mediasmart came out