Athlon II X2 sounds like a good plan. Sempron 140 even. Put that on a 785G or 880G motherboard and enable hardware acceleration, and you've got a fairly potent machine for the price. 890GX wold also work, but that's a lot to pay just for the GPU. Any of those combos should play HD-BluRay. If you want to save even more, and aren't planning to upgrade, you could use an AM2+ 785G board, which would use DDR2.
As far as power supplies go, there's a 400W Corsair on sale right now:
$15 instant rebate, plus a $20 MIR and free shipping...that's about 1/3 to 2/5 of what this usually costs.