Re: Diddy little thing!
I can't make an attest to Windows MCE.... AND WHO'D WANT TO USE THAT POS!
When you have either MythTV and or better still VDR.
Which unlike the above (Microsoft!), works with every DVB Standard out there and, VDR which works even better then MythTV!
Assuming for a moment that we have VDR as a player and a Reel Multimedia ~*Netceiver~ (sitting somewhere out of the way (ie Attic or in the Basement), Which you connect to your Dish / Cable Network / Areal, and then to a local Network throughout your House.
I could see something like this working out well enough if Shuttle were to allow us to use a Remote control as well a touch options.
As for being able to do 720P (1366x768 = 1280x720 IIRC), that would depend on what kind of IGP this thing came with. Assuming for a second that it was a modern nVidia Chip GF8400 or better then you could use the VDPAU Driver to display such content.
My TV is also native to 1366x768 and is capable of both 720P and 1080i.
I use a Reel-eHD to do the heavy lifting h.264 decoding for the moment, but I do plan to move to the nVidia VDPAU in the near future. With the release of VDR-1.8.0.