[fritsch]

1080p is not a problem at all. Nowadays computers play it without issues. This thread is about 1080i and deinterlacing in high quality.

Don't go with 12.04 - it is too old. Cause of Bugs in SNB GT1 GPUs a newer Mesa and a better Kernel >= 3.11.3 is needed. One for stability the other one for HD Audio.

Start with an Ubuntu 13.10 64 bit Mini Iso. Don't install Unity, compiz and no pulseaudio. Make sure to have libva1 and libva-intel-vaapi-driver installed.

I will update the howto during the day. It's really easy.

Edit: Just read the other replies. What wsnipex said

@evilsephiroth: Concerning the questions you ask, I think OpenELEC is a better choice for you - It will just work.