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Intel i3 Vs i5

Nah. Get the i3 2100. Even using it's onboard video processor will do the job nicely for you. It'll save a bit of money on the 2500K, which is quite frankly overkill for a HTPC.
 
With a low budget and the uses of light gaming and videos then the i3 is the ideal chip to go for. It is a dual core and can't overclock - but it is still mighty quick in lightly threaded applications (like games) and costs a whopping £78 cheaper than the i5 2500K (money which is much better spend on a decent graphics card).

The spec that beejjacobs posted (minus the case as you don't need one) is very nice and within your budget.
 
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