having ditching cable 3 months ago to save a few bucks, I can tell you there is no one-stop solution out there yet. Hulu is better than netflix ( which I also subscribe to ) based soley on netflix's streming library, which as others have said....sucks. I run an old P4 as an HTPC, but it has problems with hulu, so I stream it to an xbox360 via PlayOn from a more powerful server. PlayOn is probablly the best out there right now, primarily due to the large community script effort enabling many shows and networks normally unavailable. Real-time transcoding is nice too for downloaded movies. All 3 of these services, plus the ability to simply surf to a network/shows website with the HTPC ( non-media center ) and broadcast HD makes a decent solution, but make no mistake...paid cable/satelite service is far superior. Right now, my wallet makes the decisions though.
On a side note: you don't really appreciate the convienience of "channel surfing" until you no longer have it. You miss out on previews of new series, and EVERY time you sit down to watch the tube, it requires effort and knowing exactly what you want to watch and how to access it best. Pain-in-the-butt, but for the "cheap" like me it works.