Schbeemb:
Pete - which motherboard and gfx card were you using ? I'm using a 780G with an ATI3450 in crossfire configuration. Whilst my TV, the Panasonic TH42 P70 doesn't display 24fps, I can use ReClock to speed up BD playback to 25fps and have completely smooth video on my screen. I don't think BluRay players can do that. I'm going to compare a Panasonic BD player to the computer playback I think - see which I prefer. If you were using the old Intel mobo - G45 or something like that, then it probably wasn't any good. Very interested in your answer.
Back to the original question and I do believe it's entirely possible to build an all in one media centre that does pretty much everything, you've just gotta know how to configure it. Higher end GFX cards can now output dolby true HD though I'm not sure whether Windows plays with the audio at all or not (ie: dunno if it's bit perfect). I can't answer that one but anyone with a receiver can as it'll display the digital signal that it's receiving.
I'd personal keep my music playback separate using an ESI Juli@ which would allow me to pass music at different resolutions to my external DAC.
Many ways of doing it, and if you've got the money you can have it silent to. The software integration is all bound to improve going forward, it's just a shame that us audiophiles remain in the minority.
It was an older configuration with a Gigabyte 8600GTS silent graphics card, AMD Athlon 64 3000+ and an MSI Premium motherboard (can't remember the model) + 4gb RAM using Vista Home Premium.
I'm sure you can build a better HTPC than the one I had, but to make it silent and powerful enough costs a fortune and the hassle I had with PowerDVD just wasn't worth it. Perhaps someone with more PC knowledge could make it work better, but for me it was working out too expensive when I could buy the excellent Sony blu-ray player for £160.