For high speed ripping I'd recommend a Plextor CD writer or one of their SCSI drives if you got the cash to go SCSI.
Match that with the fastest CPU you can afford as the encoding process is purely dependent on horsepower.
DiGNAN17 is correct in suggesting the ATI AIW, I have one of their older cards and the TV features are great, although I now wish I had gotten there PCI TV card and a seperate AGP video card to make upgrading easier / cheaper.

If I was building a new PC now I'd be going with one of the small Shuttle cube-like PCs, either the SK41G ($309) or the SB51G ($342) depending on your religon (AMD/Intel). Add in a CPU Athlon XP 2400 ($195) or P4 2.8Ghz ($185) (note: if you drop the Athlon speed by 300 you save almost $90).
256MB/512MB of DDR ram ($56/$128) for a bloated OS.
The ATI All-In-Wonder RADEON 9700 cost $393 but if you can slum it with the 8500DV you'll save for $230.
The on-board sound & NIC are good enough for me.
As there is only on 5.25 bay I'd be filling it with Plextors DVD/CDRW drive ($132) or in black ($140) so I can still watch movies. Add in a black floppy ($11) and the BIGGEST hard drive you can afford WD 120gb/8mb ($159) and you has a pretty powerful but small PC.

Pair it up with a wireless keyboard & mouse (bonus geek points for mounting it inside) and a good flat panel, and it will be a sleek looking PC that would not look out of place beside the TV.