Mines onboard the motherboard. Does a fine job of blu-ray. It's the 780G chipset, so a Radeon HD3200. The 785G chipset, which is available new at the moment has a Radeon HD4200 IIRC.
No need for an external card with the right motherboard, but if you feel the need grab yourself a Radeon 4350 or 4550 with HDMI onboard and a low profile bracket if you get a smaller case. They're nice and cheap and will let you pass audio over HDMI as well as coping with blu-ray no problems. Will be crap for gaming though.
EDIT: Should also note, for silence, you'll want a passive card. Most of the 4550's have a fan and passive are not low profile, so a passive 4350 would be best. Sapphire do a well priced one.