One other thing to consider is HDD space.
Using a dedicated HTPC (like logifuse is doing) means you can play DivX/XVid files onto your TV.
Using the XBOX360 as an extender (as I'm doing) means that all your videos will have to be one of two formats; MPG or WMV.
Comparing file sizes (DivX is approx half to third the size of an MPG; now don't quote on that as it depends on many parameters that you would set
) means that you'll need lots of more HDD space on the MCX path.
Oh, the noise. I'm over it now, especially since the Sydney flight path was changed to go over from the north..
If you asked me what I would do for my next HTPC, I would go for a slight variation of logifuse or GlenR; a minimalist HTPC with a NAS (added later).