OK. So I couldn't fall asleep last night (I think that had something to do with the two hour nap I took at 5:30) and as I was trying to fall asleep I started thinking about the ideal Mac Media Center, based around the Mac Mini. So here's what I'm thinkin'...
So the Mini gets a big hardware boost. I'm thinkin' a high-end Duo Core processor, 250 GB hard drive, at least 1.5 GB RAM and a nice video card, at least 128 MB. You'd have WiFi, Bluetooth 2.0, and a smaller version of Apple's Keyboard (essentially the same one, but without the numeric keypad on the right. Maybe even chop everything from "F12" over, although you'd have to work in the arrow keys somewhere. Software would of course be OS X, but you'd need some kind of DVR software (a TiVo killer) which is rumored to already be in the works.
The basic gist is that you run your cable line into the MMMC (Mac Mini Media Center...clever, huh?) and from there into your TV. The MMMC would serve as a DVD player, so you wouldn't need to worry about that.
Using airport, you can transfer things from your TV to your computer. For example, an instant message pops up while you and a friend are watching TV. Hit F5 (or whatever the keystroke would be) and something like Expose comes up, but in addition to showing all the windows open, it also divides the screen in half: one for TV and one for desktop. Slide the IM conversation over to the desktop and the conversation is transferred off the TV to your deskop where you continue chatting, uninterrupted, while the TV show continues.
Partner with Sirius or XM Radio and integrate it into iTunes. In the bar on the left, have an icon for their service. Select the station you want to listen to and listen to it through iTunes. Like the song you're listening to? Select it and you'll be taken to the Music Store where you can purchase it. E-mail, IM,and RSS alerts could be incorporated into watching TV, movies, etc.
Hmmm... yeah, I think that's about it. I'll ponder more though. Don't worry.