There are lots of networked video players out there. Which one you get depends on what formats you want to play back. If you encode everything to H264 or WMV or one of the other popular Internet distribution formats, almost anything will be OK. If you rip MKV or ISOs (exact bit-for-bit images of a DVD or BluRay), then there are very few, if any, dedicated players that will play them back flawlessly. If that's important to you, a HTPC is probably the best device.
I wouldn't cheap out on a wireless router. I use and really like the Apple Airport Extreme, though there are probably others out there just as good or better. I've had bad luck with a repurposed Linksys WRT54G running one of the freely available hack packages.