Htpc Software recommendations

Hello, I built my parents a new htpc for their new plasma tv, but I am at a loss on what I should run to make it most user friendly to them. I will be away on a deployment so I wont be able to give them tech support very easily, so it will have to be pretty stable.
Specs are as follows:
1 tb WD caviar green
samsung blueray
I3 530 2.93Ghz processor
4 gig gskill ddr3
Asrock H55M Pro mobo.

I have win 7 media center on it now, but am confused on what add-ons to use and any other software that would be handy for me to install or if I should use a media center alternative.

The main purposes of the htpc are:
1) As smooth of hd as possible (even if this means buying a video card, currently it isnt very smooth when there is a lot of movement such as a running scene in a BBC Life video)
2) Playing internet tv such as hulu but also youtube type sources. (Hulu Pro/desktop?)
3) Video file playback, mostly avi, mp4, mkv, etc.
4) Blueray playback.

My brother who still lives at home likes to play pc games so keeping that door open for him would be nice. I would like them to also be able to use features like the internet and email. Having all of these things under one front end would be awesome but if they have to go to the desktop to do some tasks it is ok. It is going to be playing on a 50+ inch tv so the interface would need to 'look' right on such a big screen and they are getting there in age so the 10' user interface might be better at 15' lol. Any help or suggestions are greatly appreciated. Thanks,
John

Media Center should handle most of the discs played and IE8 or Chrome can handle the Hulu, Netflix, etc. Most sites buffer and adjust playback for the graphics speed and capability and for now don't offer much beyond 480P. My AMD Phenom X3 and onboard 4250 graphics does fine with a 37" 720P tv.