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I don't see any incompatible components, but that's not really my area of expertise. As far as making it cheaper. I always just keep a good eye out on eBay, Buy.com has some good rebates, NewEgg, TigerDirect, eCost, places like that always have good deals.
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Dell Poweredge SC420
Windows MCE 2005
Intel P4 2.8 Ghz 800 Mhz FSB
1GB DDR2 RAM
40GB SATA for OS
300GB & 100GB for storage
Yamaha Dcrappy Soundcard
Pioneer DVD+/-RW Burner 16x
nVidia DualTV MCE tuner
ATI RADEON X700 PCI-E 256MB
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