Won't play FullHD video? Maybe if you're talking about crazy everything-x264-can-do encodings, but a decent 2006 computer will have a geforce 7xxx or similar and play "normal" FullHD video like you buy from itunes just fine.
But without the GPU (and I'm not sure how geforce 7xxx driver support looks now) even 720p videos might get problematic, some becoming pretty much a slideshow, some being just slightly uncomfortable when going around 20 fps. I know they do on my 2007 macbook.
The problem is that the general use case doesn't have a media center pc from 2007, "A significant portion" of consumer hardware is EXCUSIVELY for web browsing and word processing. Sources: every single relative I have except for my father who uses trading software to watch stocks, only use a combination of word (if I haven't touched their boxes), libre office (if I have), ie (if I haven't) or firefox (if I have). Those two cases cover 90% of pc use, maybe some photo browsing, but none of them watch video on a general purpose pc. (yet). Netflix probably changes that.
