I'm doing that with the XBox 360. It has HDMI output and does 1080P. It will stream movies, video, music, and pictures from my Windows home server. It will stream movies, video, music, pictures, and HDTV from my desktop computer running Windows Media Center. It will stream movies from NetFlix in HD. It will play music from Last.FM. You can download and purchase video and movies in HD from several sources via the XBox. Then, when you're bored watching all those movies and pictures and listening to all that music, you can use it to play games in 1080P
You say the XBox doesn't do 5 Ghz Wireless? Ahh, but here's what I did...
I got a Wireless Ethernet Bridge. The one I got was a Linksys, I think the model is WRT610N. It is a dual band ethernet bridge. I have it setup to use the 5 Ghz band, linking to my DIR-825.
The ethernet bridge only has one single ethernet port was to purchase a small 5 port ethernet switch. The output of the eithernet bridge is connected to the 5 port switch. I have the XBox360, a desktop computer, a network attached storage drive, and our Dish Network satellite receiver all connected to the ethernet switch. I have a fixed IP address assigned to the NAS drive, but everything else uses DHCP from the DIR-825.
It works really good. If I look at the Stats on the DIR-825, there is hardly any dropped packets on the 5 Ghz band vs the computers I have connected to the 2.4 Ghz side. I would guess it's because of other 2.4 Ghz routers in my area.