I can't comment on the company as I have never done business with them and don't know anyone who has. The DM 5000 looks okay, but I have a couple of concerns:
1. It is very important IMO that the TV tuner has hardware MPEG encoding. I can't tell from their documentation what kind of TV tuner they have. Without hardware encoding, your cpu will be used for this task. Every time I have tried to use a card like this there have been sound sync issues. Pay the extra money for one that has it - you'll find you have fewer headaches this way.
2. With XP installed, you will definitely need more than the default 256 MB of RAM. I think you mentioned in your post that you would put in 2 Gig. That's fine, but might be excessive. I'd say 1 Gig is plenty and will save money for an upgrade to the...
3. 40 GB hard disk... I can't even believe this is an option. With the OS and applications installed, this would only allow you to record a couple of hours worth of video. Definitely go with the 300 GB as you wrote.
4. The integrated video - I don't know enough about this chipset to comment, but I would be cautious.
5. Speakers? If this is being hooked up to your stereo, there is no need.
6. Are there any free PCI slots available? This system looks very thin and I couldn't find this information... If you want to add a Hauppauge card, or any other card for that matter, you will need at least 1 free PCI slot.
Now, if you keep looking, or decide you want to build one yourself, I would recommend a motherboard based on the nForce2 SoundStorm chipset . Information can be found on nVidia's website and here:
http://www.nforcershq.com/ . IMO, this is currently the best built in chipset for audio that's available right now. It handles Dolby Digital in hardware and has a lot of customizability in the drivers.