jon, what you posted is pretty much my old setup which failed as you are finding. on a long journey you will yes eventually conclude what you have concluded. so now you are crossroaded...XBMC is a good choice, i set it up everywhere in my house, but eventually chose back to JRiver (integrated dbase, Gizmo, better tagging, better picture quality, etc.), except for Inet TV (which i use XBMC and other stuff for)
But you will need a new PC to transcode/stream and/or video convert..there is lots of good stuff on this site about HTPC builds, some very high end (some paid more for their GPU's than i did for my entire build+).. i got 3300 Jmark with this build AMD 8320, 16gb ram, gigabyte MOBO, AMD 7770 GPU, OCZ SSD, Seagate 3Tb HDD, win 8.1, water cooled and it works like a charm and only steady 100% CPU utilization when i am converting a lot of PVR'ed TV.
My fun/objective was being as "cheap" as possible to meet my expected need so it took me 3 months to fully put together (eg. GPU was only $65 and the last piece).. and i have no plans to move to 4k TV but if you have that as best i know will be a big issue for the build..but many others are much more knowledgeable than me.
PS i got about a 55 page document of my journey, as you may end up doing a lot of testing, and having a cookie crumb trail is quite helpful (about 15 pages of trouble logs, tried this didn't work then tried this it worked, then...) have fun.