I owned an embedded motherboard with the e350. It had trouble with high bit rate 720p and 1080p video, from any source. The CPU would peg, just like you are seeing, for anything software decoded. And the onboard GPU just wasn't up to snuff even when setting VLC to hardware acceleration mode.
I used it for general browsing until the average website had so much crap on it that the little cores couldn't handle it. (I believe I had it overclocked to 1.8Ghz as well)
I gave the board to a friend who turned it into a SNES emulator for his kids. Went out and got myself an i3-4130T to become my HTPC.