If you don't already have an iPod, I'd look closely at the SqueezeBox first and perhaps the AppleTV second.

I went to the Apple store and ask about Apple TV. Seems that I would be able to use the Apple TV to listen to all of my CD's once I donwload them into my external hardrive connected to my iMac.
Also I would be able to use the Apple TV and watch my personnal Standard DVD's once downloaded on my iMac. I have to purchase a software that enables me to download my movies on my iMac and store them on my hardrive.
I asked the sales-person what program to use and he told me he could not by law give me the name of a program that works well with the mac.
The word ids GOOGLE.

I've poked around a little with the idea of putting DVD's on AppleTV, but haven't dug into it enough to actually do it.

I'm also in the Squeezebox camp and I also use it to stream lossless FLAC files. My primary motivation was to be able to crate up all my CD's so the kids didn't slowly destroy them. One of these days, I'll build an embedded media system (maybe using MythTV) to add 1080p (but mpeg4 compressed) video to the mix so I can stash my DVDs away too. There are laptops out there these days with HDMI outputs and digital audio out for well under a $1000 so I might just go that route and have a couple of TB of disk mounted wirelessly.

Best,