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Does it have to be a laptop? Since it's main job is to play media on your TV it would be sitting next to it most of the time thus a basic PC would deliver better value/$.
Not built a pc for ages but with $500 I'm sure you can get a decent micro/mini pc setup with a vid card to play even 1080.
Side note: I got a free Dell Netbook from HSBC as a gift and its a complete POS, slow as hell, heavy, thick brick that can't even play 720p. Stick with a proper laptop if you really need a portable media player.
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