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First a little info about my setup

I've currently got a windows home server V1 sitting in my basement with 8 drives (about 13tb of Movies, Videos, Music, and Photos), in the living room I've got a WDTV being used as the front end. The living room is directly above the closet where I have my server.

I'm running XBMC on my Windows 7 desktop upstairs, and on my Macbook Air.

Here's my dilemma. I was originally thinking of putting together an HTPC for the living room in the next couple of months, and later this year I was thinking of replacing the server in the basement. However giving it some thought I was thinking maybe it would be a better idea to build the server, and run XBMC directly on that computer instead of having 2 separate computers. I'm thinking that I could have the computer in the basement, and use HDMI over ethernet connections to run the HDMI signal from my basement to the living room. (Monoprice PID # 8009) I would use a Lenovo Mini wireless keyboard (which uses RF), and an IPOD touch as the XBMC remote.

Is there a disadvantage to using the same PC as both the client, and storage server? I will not be using more than 1 client at a time.

These are some of the components I am looking at, I assume this is more than enough to play 1080P video seamlessly
Antec P280 Case (3 5.25" bays, 2 2.5" bays, 6 3.5" bays)
Cooler Master eXtreme Power Plus 600W
Intel Core i5-2300
4GB ram
Gigabyte MB with gigabyte ethernet, and 8 SATA ports
EVGA GeForce GT 520 (02G-P3-1529-KR)
Crucial (CT064M4SSD2) 64GB SSD
7 x 2tb Western Digital drives.

Any advice / suggestions?
well, lemme ask,
if you already have a server going on in basement,
why dont u just get yourself an HTPC to replace your WDTV box?
My current server is a HP EX 495, it has 4 drive bays and they are full. Attached to that I've got a 4 bay drive enclosure that's holding the other 4 drives connected via USB. The 8 drives are almost full, and the server is almost 4 years old.

So basically it's time to replace the server with some new hardware. So I'm thinking that since I have to build a new server anyway, I might as well build one box that can handle storing/serving media, and install XBMC on it as well. An added benefit is that it won't be in the same room as my home theatre so no noise. I'm just wondering if most people have 2 separate computers one for storing their media and a second one for playing it, or if it's fine to have everything on one device.
well, i dont suggest you get all under the same roof.
for some it might be ok, but it looks like your a good media collector
so drives fill up fast.

best for you to do it right 1 time,
and live happy ever after.

this means, building an unRAID server box to store your media
http://ow.ly/1uaFv6

and build a separate HTPC box for playing it!
http://ow.ly/1s4Jcf

Smile
I guess I'm not personally a big fan of linux, even though unRaid is managed mostly from the web interface I am really not a big fan of having to do a lot of things from the command line.

But regardless of server OS I guess you still recommend having 2 separate computers.

I guess unRaid has 2 real advantages over a Windows setup... Disk Parity (I don't really need this, as I have a set of drives I keep offline as a backup of all my media) And the ability to have shares span multiple volumes (similar to Windows Home Server V1) this is the one thing I will miss the most from WHS. Surprisingly Windows has the cost advantage, I can get WHS 2011 for $83 Canadian, and unRaid pro would run me $119 USD.


Thanks for the advice Eskro...
no problem