With nothing but internal changes, the Mini would still make an awesome computer. It's not just cheap, but the cheapest and most powerful machine I know of in that form factor (similar to nano ITX).
It doesn't need a DVR, it doesn't need a goofy looking dock, it just needs updated hardware, a little more TLC, and maybe a slightly more attractive price (but that's not necessary if they make the machine worth it)..
The current mini's shortcomings are the graphics chip and the hard drive, if they swap the HD with a nice 80gb 5400rpm drive and swap the graphics chip with something lowly (an x600 maybe).. They'd still be awesome machines.
Adding a DVR to that machine would not just screw up the purpose of the machine, but make it annoy everyone, you'd be opening a can of worms...
What people want in a DVR/"media center"
*The ability to record HD
*The ability to record and watch TV at the same time (dual tuners?)..
*1080p H.264 recording (which I don't even think a dual G5 will do in realtime)
*Complete Media center system (recording of every F-ing kind, including DVDs of course)
*HDMI output (it better not, I'd be mad) and input (HDCP? No thanks).
*Some crazy wireless interface that can transfer video to other machines on the network simultaneously....
What this would require..
1. Huge price raise: I don't care what you say, pigs will fly before a dual tuner (and single output) HD DVR that does 1080p H.264 in realtime (on 2 tuners not to mention decoding on the output) machine can be made for $499.
Dish and DirecTV sell dual DVR boxes of the sort and they're NOWHERE near as capable as a computer -- they cost $799.
2. Said boxes are about 4 times the size of a Mac Mini, at the least. Your run of the mill cable box with similar capabilities is about 6 times the size of a Mac Mini
3. People want cheap macs more than they do a stupid media center.
Anyway, last thought: Why does anyone want an iPod dock built in? They look stupid.