Ever since I started using computers for home theater enhancement, I've been using home built computers. I tried using the Popcorn Hour A-110 for a couple years, and it works decently enough, but does have it's share of problems. Since I recently built a new computer, I took all my old stuff and put it into a smaller case about the size of an A/V Receiver, sits nicely next to my receiver, barely noticeable. The only thing I got extra was a 64GB SSD as my main hard drive. All of the movie and TV shows come from my home network (8TB worth of stuff).
The little boxes like Popcorn Hour, WD TV, Apple TV, Roku, etc, etc, are fine for basic media playback, but if you are willing to tinker a little bit, you can have easily the best interface available. You will never understand how you went without it after you run the latest version of XBMC (Xbox Media Center) on a home PC.
There is a way that you can install it on a first generation Apple TV and then you do a HD decoder upgrade if you want to view 1080p without skipping. But you will have to buy a used 1st gen Apple TV in order for it to work.
Bluefish: Apple TV and full 1080p - Broadcom Card install.
Here is a demo of the XBMC, it is truly awesome in every way.
[ame]http://www.youtube.com/watch?v=65Zg_Q8mQDI[/ame]
No, you don't have to have an Xbox. You can have a PC, Linux machine, Mac, Apple TV (1st gen), etc. You can get a simple RF universal remote with a USB receiver or you can do what I do and use a Android phone, iPhone, iPad, or whatever else as a remote. Or if you want you can use a wireless mouse and keyboard.
Seriously, best thing ever for movies and TV on your computer.