I've still not come up with anything perfect yet, and I think your suggestions Jim are in the same direction as mine. Even with a PC in another room the issue is getting the TV into an application on that PC to display on the TV - that requires a Slingbox or similar and that all adds up.
This is what I'm thinking about doing.
PC of some sort in the livingroom (will provide access to the Internet for streamed music and Internet access). Can also plug the iPod in to this too.
LCD TV with VGA/DVI, s-Video, SCART or HDMI inputs. Provides for receiving the PC signal, TV signal, and radio over Sky too.
Using my existing Cat5 cable around the house put the output of the PC over Cat5 to an input on the TV - Using something like a HDMI to Cat5 back to HDMI and a small Bluetooth wireless keyboard and mouse.
Using my existing Cat5 cable and KAT5 converters put the signal over the Cat5 again to a SCART/s-video TV input.
Not as nice as 1 box does all, but at least I don't have anything more than a TV plus a few hidden cable, and a wireless keyboard and mouse.
Small, quiet PC or Mac with appropriate outputs - £200-500
LCD TV - £200
KAT5 TV module - £60-80
Signal Converters - £20ea
Not much change from £500 at a minimum. Perhaps I need a £20 analogue radio

We'll thats the thinking at the moment.. a few more weeks before the kitchen is finished to make up my mind.
Stu