For a while now I've been wanting to cram an HTPC inside of an NES, but never got around to it as I didn't have a the motive to spend the money for a fun side project. (In college, here.) Lately, however, I have a renewed interest in completing this. It's been done before, but not recently. With solid state being reasonably priced now, and motherboards with integrated Atom processors able to do 1080p playback now, I get the impression that a much better one could be made now.
Bonus: Although entirely superfluous, it would be awesome to give it a 2.5" hotswappable drive bay under the hood, instead of a disk drive, and modify old nintendo cartridges (broken ones, of course) into hot swappable 2.5" drives. I can think of no cooler way to organize an extensive media collection.