I'm probably missing some info here because I just skimmed the thread, but 
I would think that a good plan would be to have a central server that 
smaller computers can read files from.  I can't envision one server 
sending out many video and audio outputs simultaneously, but I can see it 
serving many files at once to smaller machines that then display the files 
on their default audio and video outputs.

I ripped all my CDs to MP3 and put them on one machine, then I put a small 
computer on my stereo system, and I have several other computers.  When I 
want to play a song, I can play it from where I am (computer or stereo) by 
grabbing the file from the server.  I can also connect remotely from out 
of town and download MP3s.  A couple of weeks ago I was out of town with a 
rental car.  I had forgotten to bring some CDs, so from the hotel room, I 
downloaded some of my songs, burned a CD and listened to it in the car the 
next day.

Mike