I have an HTPC, and I feel it gives greater flexibility than a streamer, and works best for me.
For starters I can stream webcasts over it (or stream things like Hulu, BBC Iplayer, etc via a vpn when there isn't too much network congestion).
As for fans, etc, my HTPC is pretty damn quiet.
As for start up, it takes about 20-30 seconds to boot from cold and about about 5 seconds if in standby mode.
I find the UI better on an HTPC (using Boxee or XMBC).
As for Windows messages popping up while you are watching a show, this has NEVER happened to me. Also I've NEVER had the problem with windows slowing things down. Mind you I run a very slim machine, and it is purely an HTPC and nothing else.
As or codecs, all you need is a codec package like Shark. I just had to install that and it plays everything I need it to. Also with streamers if it doesn't play a certain codec, that's it. At least with an HTPC, you the option of downloading the codec to play the file with.
As for mice, keyboards, etc, once things are set up, you just use a remote on (you however may have to keep these in storage though, as you may need them).
I have set my HTPC up quite nicely so all the shows I want auto download, and for movies, they download automatically once I have selected them from my necessary usenet search provider and everything is auto categorized.
You are right about constant updates though.