Video: ATI still rules the roost when it comes to video overlays for DVD playback, and have good TV outs as well. Their driver support is still sucky though . Look into a Radeon. Ok, so it wont have the same level of 3D performance as a modern GeForce card, but 800x600 is the limit for TV use anyway.

Audio: Do you want analog outputs, or will spdif only suffice? If you want analog, then you have to be prepared to spend the necessary $$ on a pro-audio level card - all the consumer cards have shitty analog stages with high noise levels. Look for Delta or MAudio. If you only need spdif, then I'd recommend a cmedia 8738 card over the audigy or SB Live. It can output 44.1KHz natively (All SB cards will resample 44.1KHz to 48KHz), and does an acceptable job with games.

Noise will be your main issue - unless you want to stick your HTPC in another room. Research your CPU and heatsink/fan combo carefully. You don't need the latest CPU for decent DVD/mp3 playback - anything better than a 600MHz P3 will suffice - even with Micro$ofts bloatware OSes.

Check out the HTPC forum at www.avsforum.com. Probably the best resource for this kind of information.