I've recently attached my previously headless Ubuntu server to a TV - so it's purpose has morphed to be a server plus a media centre. I've installed Fluxbox, a minimal window manager for X. It means there's a GUI for the server for playing videos and maybe even youtube videos (if the old video card in the server can handle it).
All the extra software is available through the Ubuntu repositories. Installing fluxbox was not too difficult, although there were some problems getting everything required to run a GUI. It is quite configurable, but I haven't gotten around it that just yet. The default set-up is usable. Then just add Midori for web browsing and VLC for video.
Getting the wireless connection and sound to work was quite tricky. For wireless, I had a D-Link DWL-G122 802.11g Adapter available. The driver worked without any troubles, and I found wpa_supplicant the easiest way to set up the wireless.
The two most important places to look when doing this are
These were some of the most helpful pages:
Getting sound was a bit of a struggle. First of all, don't try making sound work in the 2.6.31-20 Linux kernel. It just doesn't. If you don't trust me, have a look around the web - people are finding problems everywhere. Next, it helps to have speakers plugged in (to the correct output jack) and turned on. Then check the volume in Linux. And the volume in the application.
Some of the most useful commands and files I found were:
ps ax | grep pulseaudio