Energy Efficient AMD Dual Core (or just a 3800+ if power consumption is not extremely important).
780G motherboard
2gig of PC5300 DDR2 ram
Blu-Ray Reader (Think there is a Pioneer one for £80)
Vista (32 or 64..)
PowerDVD Ultra (For HD layback)
You are pretty much set. The 780G integrated graphics will fully offload VC-1 and H.264 content decoding from the cpu and the mobos have HDMI ports that will carry 5.1 PCM/DD/DTS.
i'd personally go for a silverstone sugo, as i think they look slick and seem to be quite small, but i would say a case is totally up to you. antec do a nice htpc case if your going for the desktop style case.
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