Heres the setup guide:
http://manuals.info.apple.com/en_US/Apple_TV_2nd_gen_Setup_Guide.pdf
You dont need iPhoto.
"If Apple TV isn’t playing your photo albums or slideshows
Make sure you have photos in your photo library or in a folder on your computer.
Make sure Apple TV and the computer you’re using are set up for Home Sharing. See “Setting Up Home Sharing” on page 17.
Make sure the photos you want to share are selected. In iTunes, choose Advanced > “Choose Photos to Share,” and then select the photos you want to share."
awesome, thank you!
* Make sure you have photos in your photo library or in a folder on your
computer.
* Make sure Apple TV and the computer you’re using are set up for Home
Sharing. See “Setting Up Home Sharing” on page 17.
* Make sure the photos you want to share are selected. In iTunes, choose
Advanced > “Choose Photos to Share,” and then select the photos you want
to share.
* Make sure Apple TV and your computer are on the same local network.
* Make sure Apple TV and your computer are using the same Home Sharing
account.