Yeah, certainly would be a neat way to watch downloaded stuff on your TV without needing a noisy power hungry computer (at the moment I have a netbook connected for this job).
The obvious issue is that at $200 it's actually more expensive than the Apple TV, if you're just looking at it for a home entertainment playout sytem. But that said, it's going to be more customisable with it running Android or Linux and you can expand the memory too.