Its worth remembering that Windows Media Centre, is Windows XP professional with the media component. I had the same dilemma in regards to legit operating system, and I opted for the legit version of MCE. Personally I am glad I made that choice, I find the PVR software and recording of TV dead simple with MCE, whereas the closest PVR program I used previously was the one supplied by Hauppage with their TV card.
Its smooth, its not that resource hungry imo, well lets put it this way, I have noticed no slow down when I am doing my usual activities.
In regards to partitioning, I would do it 80/40, and put all your media on the other partition, that way if you ever need to reformat the drive, because you have been fiddling with the OS you know your media is safe and you won't lose it.