That would work, but Biostar doesn't have very highest quality boards. I tend to recommend staying with an Asus or Gigabyte board.
If you're looking to cut the price, the easiest way would be to not get an HTPC specific case. Take a look at the standard cases. There are plenty of small case that are a lot cheaper than that Silverstone.
A mid tower might not, but a micro ATX mini tower might. Or a small case turned sideways might as well. I would at least take a look around.
EDIT: Forgot to add that you should keep an eye out for combos. This is the first time I've looked at the i3 and it wasn't in a combo with a lot of boards. I've seen it in a combo with the board I posted for $190.
I am using that same mobo in my HTPC and it works great.
If this is going to be a 100% dedicated HTPC (like mine is) you could step down on the CPU (Regor) and memory (ddr2-800) and save yourself some cash. I am driving my mobo with a Regor (ok, an ulocked Sempron but essentially the same thing) and ddr2-800 ram.
If you see yourself ever doing things besides HT stuff on this PC then go ahead and get the 620 (and you might also want to go with 4gb of ram if you will be gaming) -- its a great chip and will provide much flexibility. If you do this you could even drop in a good video card at some point and Bob's your uncle! It all depends on how you see yourself using this setup.