I’m happy that I see interest for my post.
I have already up and running a configuration of a pc inside a cabinet for the past 4 years, without any box! and it's working seamlessly.
I just have plugged on a motherboard a video card (unnecessary) and a audio card (also unnecessary), initially a 500Gb HDD and upgrade it later to an 2TB HDD.
The configuration is as follows:
Hardware:
link
AMD Athlon LE-1640 @ 2.6 GHz
2GB of memory DDR2 @ 800 Hz
NVidia GeForce 8600 GT
Creative SB Live!
Western Digital 2TB Caviar
BeoLink PC 2
Software:
Windows XP Service Pack 2
Air Video Server (For sharing video over all iDevice and not only…)
Asus Updater (For updating the M/B bios and replacing the Bios logo with the one of Bang & Olufsen)
Dyn Updater (For constantly and freely updating the local ip address to a no-ip servers so I can remotely access the Beomedia)
GoodSync (File sync and back up software to always keep a back up of my songs, photos and movies on an external drive)
Google Chrome (For some better navigation)
iTunes (Needed installation for some software that depends on it like Air Video etc)
MiPony (Automated file downloader to help with long files downloaded from servers like Turbobit, FilePup, Uploaded etc)
Mp3 Tag (Best mp3 tag editor ever…)
Partition Magic 8.0 (Necessary tool for partitioning space on the HDD)
R-Drive Image (Cloning tool, that also helps as a security back up and an easy way of restoring Beomedia)
RealVNC (Remote access from any pc or iDevice I have)
Rename Wiz (Easiest file renamer ever…)
Resource Hacker (File hacking for some extra tweaking)
Shutdown Scheduler (Nice, easy and very dependable software to put Beomedia to sleep when its not needed)
SopCast (Nice and easy way to view - even in HD - football games for free or other channels)
Tonido (Turn your Beomedia into a cloud server)
U-Serv (Turn your Beomedia into a file server)
Vista Codecs (Very important codecs in order to view and have the best result in both Audio and Video of your Xvid movies)
VLC (In case you wish to watch something in high definition or something you’ve downloaded and you don’t want to convert in Xvid)
Vuze (The best torrent downloader - in my opinion)
and of course the BeoMedia 1 software.
With the addition of a video card and a sound card I have managed to have fast picture rendering and smooth reaction on menus and true surround sound from xvids that support AC3 or other surround codecs.