Such a device exists

[msjboy]

buy a media player such as Patriot Box Office ( at $29.99 w/ rebate sometimes.. I use this one) or Western Digital's WDTV...dlink Boxee, Asus !oplay, etc as well as others. Plays every format including music, jpgs, rmvb, iso, avi, quicktime, mkv ( ie blue ray rips) etc.
Also, can put onto a network via ethernet or a cheap wifi card, plays thru USB as well. I put in a hard drive on mine which serves as a movie/media juke box.
Can also be open source moded to play youtube, etc.

This is what Apple TV should have done but it has to avoid the legalities of what other companies like Patriot doing movie player rips (ie illegal downloads).

msjboy