Greetings! I've learned a lot from browsing around the board, and am considering taking the "plunge," so to speak. Unfortunately, I have some constraints, so I'd like to get some feedback before I proceed.

Needs:
- Media server to centralize and stream pictures/audio (CD quality)/video (mostly DVD rips/cellphone video, no HD content), primarily to Xbox 360; mobile device support would be nice but not necessary.
- Backup solution for data/documents on desktop/laptop, to include off-site storage.
- Reliability and remote maintenance; I will be deploying within 6 mos and won't be around for major fixes. (Putting this together for my wife.)

Current Setup:
I'm currently using my Win7 desktop to do streaming via WMP over wireless but this has been somewhat clunky, and my HDD is running out of space. I currently have no backup solution...one of those things I intended to get to, but never did. I have documents/pictures/audio scattered across three desktops and a laptop, and a collection of DVD's that are about half-ripped.

Current Plan:
I have an older homebuild desktop (back when I cared more about computer games and was messing around with OC'ing) that I'd like to use as the base system, to keep costs down. Specs:

* 1 x Rosewill R5601-BK 0.8mm Japanese Cold Rolled Steel Screw-less Dual 120mm Fans ATX Mid Tower Computer Case
* 1 x MSI P6N SLI Platinum LGA 775 NVIDIA nForce 650i SLI ATX Intel Motherboard
* 1 x EVGA 256-P2-N624-AR GeForce 7900GS 256MB 256-bit GDDR3 PCI Express x16 SLI Support Video Card
* 1 x ENERMAX Liberty ELT400AWT 400W ATX12V SLI Ready CrossFire Ready Modular Active PFC Power Supply
* 1 x Intel Core 2 Duo E4300 Allendale 1.8GHz LGA 775 65W Dual-Core Processor BX80557E4300
* 1 x Transcend JETRAM 2GB 240-Pin DDR2 SDRAM (PC2 6400) Dual Channel Kit Desktop Memory Model JM2GDDR2-8K
* 1 x SAMSUNG SpinPoint T Series HD501LJ 500GB 7200 RPM SATA 3.0Gb/s 3.5" Hard Drive -Bare Drive
* 1 x ASUS 18X DVD±R DVD Burner with LightScribe Black SATA Model DRW-1814BLT LightScribe Support - OEM
* 1 x ARCTIC COOLING Freezer 7 Pro Rev.2 92mm Fluid Dynamic CPU Cooler

Step 1: Add some HDD's
Step 2: Install WHS
Step 3: Profit?

Questions:
1) Is this system workable for what I want to do? Should I upgrade the RAM? PS?
2) How exactly does the folder replication thing work? Currently, I have 1TB (ballpark) of data I want stored, so I'd like to have 2TB of storage space...so I need to install 4TB like RAID?
3) Am I missing something horribly obvious and newbieish?

Thanks in advance for any replies.

What your describing is in line with the ex49X boxes.
So yes, you should be able to roll out WHS on that box.
The biggest factors to stutterless playback is keeping everything simple.
Wireless can be very challenging specially at higher bitrates.
There are lot's of folks on this board more familiar with streaming than I am so I will leave that to them to answer as I preffer to access my files directly in the Video_Ts format. (MTS for blu-ray)
Which gives a better picture but doesn't stream as easily as the pre-converted lower bitrate formats.

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Current DIY server DL380 G6 2xquad core 2.8ghz 32GB rdimm ram 512mb 2xHP 410 raid with 2x sas expanders (2 X norco RPC-4220) 48 slots stacked with room to grow.
30TB (Movie/File/Music)Win 2012 essentials 64bit Storage spaces
Ex490 E6400 4gb ram