Hardware video decoding in Linux

There are so many opposing arguments floating all over the web that I've been given quite a headache trying to figure out what the best solution for playing back H.264 in Linux is. I'm planning to build an HTPC fairly soon and I need a little help from you pros to figure out just what kind of CPU/GPU it's going to need.

First off, do any graphics chip manufacturers support hardware-accelerated decoding of H.264 in their Linux drivers? I've heard the ATI's Avivo works under Linux, but does it work with H.264? In order to decode demanding Blu-ray/HD-DVD caliber 1080p H.264 content, what are some cost-effective CPU/GPU combinations that would work under Linux (if any)? I know Linux isn't likely to support HDCP and AACS (legally) any time soon (or possibly ever) but I want to make sure the hardware is up to the task anyway. Thanks for any advice! (Links to benchmarks under Linux are good too, if there are any.)

Doom9 , AfterDawn.