Streaming PC from Television

I have been doing a lot of thinking lately about helping my dad cut cable costs by moving his computer from office into living room to watch TV/movies/internet on the TV. I want some feedback as to what I would need to do and have for it to succeed

PC in question:
2004 eMachines T2862
Windows XP Home Edition SP3
Intel Celeron D 330 (2.67GHz/533MHz FSB)
512MB DDR SDRAM
Intel 845G Chipset
128MB ATi Radeon 7500 (S-Video/VGA/DVI-I) [Catalyst 6.11]


TV in question:

Philips 27PT5441/37, 32PT5441/37, 27PT6441/37, 27PT6442/37 (I assume my model is the 1st one posted, I took the model #s off the owner's manual)

The TV has Component Video but I don't know about S-Video because I rarely have a chance to see behind TV since it's crammed into a shelf compartment built into the house.

Also, I want to hook the PC to the 5.1 Sony surround sound system which sits above the TV with Sony DVD/VHS combo.
At the moment everything is hooked up according to Sony instruction manual via A/V cables (YRW). I thought about switching to Optical for sound and Component but its expensive at the moment .
Any good streaming movie/show sites? will internet be readable? Thanks

I wouldn't for a variety of reasons. CRTs have poor resolution and overscan that makes using a pc on them a PITA. It makes for a bad experience, not to mention the pain of a mouse and keyboard for controlling it and the annoyance of running tv on a pc (OS interrupts your show for an alert, bandwidth drops and video buffers, poor UI of a pc on a tv, etc.). And I'm guessing your dad isn't a huge tech buff so it will prove to be a hassle.

TV on a PC just isn't there yet. Techies can work around the problems, but it's still cumbersome to use.

I have been streaming in my home for a little over a year now. I figured that in one year of not paying cable bills i could have all of the same channels and more and pay for 1 computer. I have since added a computer to every television in my home. It was the best thing i have ever done. I found a computer company that was willing to build me a computer to my specs since i am very particular about what i like but didn;t have the time to build my own. I contacted Blackboxxpc and they build me four of my media computers and my media files server. Now all of my music and movies are in one location and I only have to put a disc in a drive once. As far as for your i would say not using it on a crt screen. The television you are using will look like crap and not do the justice to the computers capabilities. I have been using the HDMI on all of mine and it is simple to hook up and looks great. Also on the blackboxxpc site they have a list of streaming websites in their articles page it is very handy for finding what to watch. Well hope i was a help.