I had the pleasure of upgrading my media center pc over the holiday break... it took a lot of work - but the reward is great.
First the ugly part -
My big motivation for moving to MCE2005 was dual-tuner support. Wednesday is becoming ground-zero for me television wise with The West Wing, Lost, and Alias all on the same night. Two tuners is now a necessity. So I had a simple plan - upgrade to 2005, remove the Hauppage tuner, replace it with the nvidia 2-tuner card, sit back and enjoy. Not so simple in practice the MCE2005 upgrade install went fine - but then starting MCE had all kinds of video problems in the UI. Swapping in a newer video card solved this problem. Start the tuner - works great! Start the second tuner - stuters all over the place.
I tried all manner of tweaks to get the stutter to go away - switched the CPU to one with HT, added more memory going from 512MB to 1GB, still no soup for me! Finally it occurs to me - maybe it's the dual tuner card? Pulling the nvidia card out and replacing it with two hauppage cards in separate slots did the trick.
Now the nice part -
MCE2005 is awesome. I was skeptical going into it - the previews on the home screen and the context menus made me think it got all complex but it's still braindead simple to use. The two tuners work great now - and the ability build playlists using the remote is very nice. Sean Alexander's blog turned me on to orb which I think is a must have for MCE customers. I also love the new "tv skin" they created - basically using different colors and font sizes in the MCE UI to make it work better on a standard television.
The third-party applications for MCE 2005 keep getting better as well - if you are an Ofoto customer - you can now see your Ofoto albums from inside MCE as well as create new Ofoto albums from the MCE UI. Much more as well. If you're in the market for a media-center PC - MCE 2005 is the way to go.