I've got mine hooked up to a Samsung 37" LCD HDTV through the HDMI port and it's working great. I've just loaded my iTunes stuff onto the Mini, then copy what I want over to my G4 if I want it there. So my main library is on the Mini.
I plan on getting a NAS drive to hold all of my media files though. It is my next purchase.
But, the Mini does a much better job as a media center than the Apple TV. Much more versatile.
Cheers