The Raspberry Pi project may be the project for designing a media player from the ground up.
The Raspberry Pi is a single-board computer designed by the Raspberry Pi Foundation that is intended to stimulate the teaching of basic computer science in schools. An early prototype version of the computer was mounted in a package the same size as a USB memory stick, and had a USB port on one end with an HDMI port on the other; Shipping versions are planned to be credit card sized. Two versions are planned, a Model A with 128MB RAM, one USB port and no network port, and a Model B with 256MB RAM, two USB ports and 10/100 wired Ethernet. The Raspberry Pi provides an ARM processor which is suitable for running Linux for a targeted estimated price of $25 (approx. £15) for a pre-configured system (Model A), cheap enough to give to a child to do whatever he or she wants with it. The prototype is part of a venture by the Raspberry Pi Foundation.
The prototype is designed on a Broadcom processor BCM2835.
128MB of SDRAM (256MB optional)
OpenGL ES 2.0
1080p30 H.264 high-profile decode
Composite and HDMI video output
SD/MMC/SDIO memory card slot
Optional: Integrated 2-port USB hub and 10/100 Ethernet controller
FLOSS software (Debian GNU/Linux, Iceweasel, KOffice, Python)http://www.broadcom.com/products/BCM2835#features
The BCM2835 is a cost-optimized, full HD, multimedia applications processor for advanced mobile and embedded applications that require the highest levels of multimedia performance. Designed and optimized for power efficiency, BCM2835 uses Broadcom's VideoCore® IV technology to enable applications in media playback, imaging, camcorder, streaming media, graphics and 3D gaming.
Low Power ARM1176JZ-F Applications Processor
Dual Core VideoCore IV® Multimedia Co-Processor
1080p30 Full HD HP H.264 Video Encode/Decode
Advanced Image Sensor Pipeline (ISP) for up to 20-megapixel cameras operating at up to 220 megapixels per second
Low power, high performance OpenGL-ES® 1.1/2.0 VideoCore GPU. 1 Gigapixel per second fill rate.
High performance display outputs. Simultaneous high resolution LCD and HDMI with HDCP at 1080p60
According to the above posts the video drivers are closed sourced. The good part is that the project is a non-profit educational project. One of the board members is employed by Broadcom; therefore video driver issues may be resolvable in an orderly manner.
Considering the cost of the boards, $25 and $35 with the onboard facilities for soldering in a JTAG header, the boards may be a cheap method of building a dedicated media server or media player. At the price the boards would also make a good home automation system.