I bought one of these to have a play with and attempt to use on my MythTV box. Hardware is definitely built to a budget (i.e. cheap - simple plastic moulding, single PCB etc). There were also numerous problems with overheating on (I think) D revision units. www.shspvr.com is definitely the place to start reading.

This page here is probably a better place to start for starting a new interface from scratch.

It will decode MP3s (and MPEG2 video) in hardware but ogg, flac etc will need to be in software and I'm not sure the processor would be completely up to it although it is something like a 300MHz PowerPC derivative. Unfortunately it can't do MPEG4 video which put it out for use with my MythTV system. I'm going for an XBox based frontend instead now.