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How to connect your TV to your PC

It seems like there’s a lot of interest in how online video might kill Cable and Satellite services like DirecTV and Comcast, so I started a mini home project to see what it would be like for someone to actually try to send streaming video from a PC to a large screen TV. I know there are a lot of different ways to do this, and I figured it should be pretty easy.
I went to Fry’s – the best super-retailer for everything geek in California, expecting to see some sort of all-in-one setup for this. I can’t be the only person wanting to do this right? Anyway – after about an hour of searching I finally found what looked like it was going to work – a VGA to AV converter (with 3 different outputs) for about $39, and a separate 3.5″ mini-jack to RCA cable for the audio ($17). I would have expected a nice all-in-one setup, but alas – the video and the audio are separate beasts. My laptop has a VGA output and a 3.5″ mini headphone jack, so I was all set. (There were some other USB-based audio enhancer thingys, but these seemed like overkill.)
Now – back home to hook all this up. It seemed to be pretty straightforward, although I couldn’t get my AV receiver to display the video. There’s probably some menu setup I needed to do, but not being very patient, I finally just hooked all three outputs into the front of the VCR (yes – we still have one), and lo and behold – it actually worked!
I was a little concerned about the quality – since I figured attaching the output directly into the AV receiver would be better, but testing with Hulu and iTunes video – the results were totally acceptable. I was immersed into my shows, and not noticing anything horrible with the video or audio quality.
So anyway – this is totally doable. I will probably go back and play with the AV receiver some more, and maybe try to clean up the wires (which my wife hates). Eventually a wireless system would be ideal. But it works! And it’s awesome. The house I’m in right now has no cable, so this is a great way to get more entertainment without spending $70+/month.
Do you have any experience hooking up your TV to your PC? Please share in the comments. I suspect a lot of people are interested in this.