Sure, why not? If you use everything integrated and aren't worried about having lots of expansion slots then there's no reason to get a big mobo. A few things though. One, and this kind of sucks because the mobo you linked is a decent price after MIR, Zotac did update the mobo: http://www.newegg.com/Product/Product.aspx?Item=N82E16813500041 One of the changes I *know* they did was fix wake on USB from S3 sleep which may be a big deal for an HTPC, maybe there were some other things too. Two, it's nice to use the CPU you've got but at some point you would want to think about dropping in a dual core. GPU assist is great but it can't do everything yet and even Flash acceleration is sketchy, I guess it partly depends on your intended uses.
I love the board, and it's been very stable, but quite picky with RAM. Not all 4GB DDR2 kits will work with it. In fact, not all 2GB kits work with it either. I had to look around and find the same kind of RAM that the original owner used with it. Luckilly ~ 1 month later someone posted some in the classifieds and I was able to upgrade from 2-4GB.
I'm afraid I haven't upgraded my DVD to a BluRay as my 42" Bravia purchased in 2006 will likely not take advantage of BlueRay anyway.
The case is excellent too, and it has holes to mount slim 60(or maybe 70mm) fans for intake or exhaust on either side to help keep things cool. So far the included PSU has been running things 100%.
What about something like just a dedicated set top box. If you are ONLY doing streaming media, I'd think this is a great option for ease of setup, and the fact that it's already very small and comes with remote, etc.
Of course there's a lot of other STB's coming out/came out that are also good. I'm only familiar with the PCH-A110, which has never NOT been able to play a video file I've tried on it. It upscales DVD/SD content to 1080P extremely well.
I know this is the HTPC subforum and this may be sacrilege, but I thought I'd give the idea incase you never thought of it.
I had originally built a HTPC out of a slimline case an E5200, 4GB of RAM and a 8400GS.
It handled excellent for almost everything. The problem was when I wanted to do more than just watch stuff on my 42". I would open a video or hulu and want to play a game in another window. Then my Antivirus would kick in. I was also downloading 4 movies.
I always knew I spent more time on the computer then the TV and this proved it. So I moved the "HTPC" to the bedroom for back-up computer duties and moved the main computer to the living room for Power. I do not regret it. I use a fan controller for lowering the noise level while watching movies. I would not go back to a smaller computer for these duties until they shrink the same components.