Recently I have been toying around with the idea of employing a media server with my dedicated Home theater. Needless to say they are expensive.
I have a friend who is very computer savvy and we have been talking about building one ourselves. I would want one that would have more than enough space for SD and Blu-Ray as well. I also would want to incorporate a seperate external hardrive for my CD's.
The purpose for all of this of course is space and also to have all of my SD and Blu-Ray discs' displayed on my 96" diagonal screen.
I forgot to mention that I already have an iMac desktop computer.
The idea would be pretty cost effective since I would not have to pay for labor. The cost comes in from buying external hardrives, wiring etc. I have inquired at Best buys and local Home Theater stores for prices for this setup. Best buys comes in at the lowest...$1200-$1400.00. The Home Theater store was $85.00 per hour in addition to acesseries.

I recently visited another friends Home Theater to check out his Samsung Blu-Ray. Very nice. It also incorporates the use of bit-streaming videos from Netflix. Pretty cool. The picture was just as good as SD and any blu-ray.
The shortfall of the Samsung is the fact that it only has a few HD movie that they are bit-streaming and the audio while it is good it is not 5.1.
Netflex working is working on the issue. When is not certain perhaps in the next year.

I am not in a rush to make a decesion on what I will do...Make a Media Server or buy the Samsung. I do think that obviously the Samsung route is the cheapest. I would not of course be able to store my Cd's or my current list of SD or Blu-Ray disc but I would be able to access any movie I want without buying anymore DVDs.

Any suggestions?
Does anyone have any idea what the cost of building a media server would cost me?
Any better ideas?

I think you're missing something here in regards to a media server. First, check out this software for your Mac,
http://wiki.plexapp.com/index.php/Getting_Started

It can basically turn your iMac into a hub for a media server. Then, all you have to buy is an external storage hub to store your media on. I'm not exactly sure how much storage you're looking for but check out sites like New Egg and Tiger Direct for cheap prices on drives. Buy an external raid enclosure, load it up with cheap drives, and have some fun. Of course, you could always look into a Drobo at the prices you've mentioned.

I too have looked into the Samsung player and the comparable LG player as well. I think I'm going to wait till the next generation at this point. Having Netflix built in is a great feature that is inline with where the industry is going. I think it could be a good compliment to a media server, not a replacement.

Thanks for the web-sites.
My friends Smasung picture from Netflix is very good the downside right now with this media is that the audio is in stereo playback.

I am going to look into the sites you have mentioned thanks again for the suggestions.

Yeah it would be nice if Netflix added streaming of digital 5.1 to the mix.