My TV viewing is now mostly done via a home theatre PC running Vista Media Center with two HD tuners and 300 GB HD, PVR functions, and Tivo program guide. I have a Yamaha 5.1 surround sound system connected optically to the PC. The TV is a 42" SAMSUNG HD LCD 1080 p and I am delighted with it.
This will play and record DVDs, but I will swap the DVD +RW writer for a Blue Ray or HD DVD type when the standards war is over and prices become reasonable. The nice thing about home brew is that you can easily replace elements that fail or become obsolete.
When all is working this is truly wonderful, but at present it is very flaky because of Vista driver problems. Why does Vista keep forgetting that it has loaded good drivers before, and ask for them again? The whole system seems to be very sensitive to the heat it generates. Evidenced by frequent freezing of the operating system or Media Center and motor-boating sound. I have stuck in an extra fan which delayed the onset a little, but what I assume to be heat problems are still there.
All my CDs are on the HD with cover art and play lists, and it provides a great juke-box-like system for playing music.
This will be a wonderful way to do it when they get the bugs out.

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RE: Up-Sampler
I have.
I bought a SAMSUNG HD-TV, and since most of the DVDs we own are just plain DVDs that I have no intention of re-buying in a high-def format, I got the SAMSUNG $99 upscaling DVD player.
It works great! It does struggle with DVDs that are full-frame format instead of WideScreen (I think the source DVDs have fewer pixels, but I don't know for sure)
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