building a HTPC for the first time, need some advice

ok, the basics:
I already have a PC for gaming, so this does not need to do anything involving gaming. I work for a cable company, so I already have a DVR that I don't pay for, so I don't need to be able to capture incoming TV signals. also, and this is not a strict requirement, but I'd like to keep the energy consumption low, as well as the pricetag($700-1000 USD is my range).

so far, I'm thinking of building around a core of a 780G mobo with a 45W 4x50e CPU, 2GB RAM and either 2x750GB HDDS or 2x of the 640 GB drives that WD just rolled out with. I am toying with the idea of the GP drives that WD has on the basis of less noise and less power. I am thinking of this case:
http://www.newegg.com/Product/Prod [...] 6811129030

Most of my DVD collection has been ripped onto my current PC, but its a bit too loud for watching movies, sucks down the power like mad, and it really heats up my room something fierce, so I'd like to use it less. this PC will be attached to a 42" 1080p LCD TV via an HDMI cable, so HDMI output is a must, and I'd prefer to have the sound run over the HDMI cable as well for simplicity's sake, but its not a strict requirement. I will be putting a Blu-ray drive in this, so whatever video device you might suggest must be able to handle HD playback.

I'd also like to take a swing at using Linux for the OS, but I haven't been able to find anywhere that says there is a means of playing HD content in Linux. If I dont use linux on this PC it will be running Vista Premium(probably the x64 version)

any advice on the components I've selected would be greatly appreciated. I have never built an Intel based system, and I would not rule that out for this, except that I don't see any alternatives that can do the HD playback and still remain in the price bracket of an AMD based system.