A 500MHz CPU is going to have problems encoding video in real time with more advanced codecs. I ended up simply buting a TiVo, and hacking the shit out of it. It's got dual 120GB hard drive, ethernet, a web interface, and stuff to extrace video set up, and on-screen caller ID.
if you want to go the PC route, yeah, you probably need more CPU power. You might want to look at one of hauppauge's PVR cards, they have build in MPEG encoders, so your CPU doesn't have to do the work.
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