Raspberry Pi. It's really an amazing PC. Not only it's really tiny, can run Quake III and play back full HD video through HDMI, but it only costs $US25! Check out the video demonstrating Quake III at full speed.
And that's still a alpha board, with the following specs:
700MHz ARM11 128MB or 256MB of SDRAM OpenGL ES 2.0 1080p30 H.264 high-profile decode Composite and HDMI video output USB 2.0 SD/MMC/SDIO memory card slot General-purpose I/O Optional integrated 2-port USB hub and 10/100 Ethernet controller Open software (Ubuntu, Iceweasel, KOffice, Python)