your problem here is network, not the xbox.
From all I have read, using the XBox as a playback device is actually quite good.
Get your xbox wired up instead of using it via WiFi (try looking into powerline adaptors if using ethernet is a no-go). And if the PC you are sharing media with has Windows Media Centre on it, have a look at a free add-on called Media Browser. With a bit of setting up, it'll produce a really great "jukebox" with cover art and the like. Once you have this done, setup your XBox as a Windows Media Centre "extender" (it's all explained on the MS website) and you will basically have a media browsing solution as good as or better than XBMC and the like, but on your XBox.
But none of the above is worth it unless you can get your xbox to be connected by something less spikey than WiFi.
From all I have read, using the XBox as a playback device is actually quite good.
Get your xbox wired up instead of using it via WiFi (try looking into powerline adaptors if using ethernet is a no-go). And if the PC you are sharing media with has Windows Media Centre on it, have a look at a free add-on called Media Browser. With a bit of setting up, it'll produce a really great "jukebox" with cover art and the like. Once you have this done, setup your XBox as a Windows Media Centre "extender" (it's all explained on the MS website) and you will basically have a media browsing solution as good as or better than XBMC and the like, but on your XBox.
But none of the above is worth it unless you can get your xbox to be connected by something less spikey than WiFi.