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CoreAVC should do it if you pay for the pro one (allegedly; not noticed the trial version doing so, but perhaps it doesn't include it). You can also try MPC-HC which will try to use DXVA for H.264, though I'm yet to actually catch it doing so.

Neuf, the third French ISP (in terms of subscribers), has announced (in French) today a new offer, "EasyNeuf" (still in French), aiming at reaching people who don't have a PC: a small PC-style "plug-and-play" appliance called NeufGate running GNU/Linux. It will include (optionnally) a monitor (different sizes available), a mice and a webcam for 99euros (with the 14" monitor) and cover most common usages: e-mail, instant messaging (MSN), web browsing (Firefox), videoconferencing (Ekiga), a spreedsheet application (Gnumeric), a word processor (Abiword), an image editor (the GIMP), a movie player (Mplayer), a PDF viewer, ... The OS is built from Linux (from scratch), runs kernel 2.6.17.11 and takes less than 100 MB (less than 168 with applications). It will feature 3 different GUIs: for novices ("Easy"), for medium users ("Ergo") and for advanced users (GTK-based with an OS X-style dock, so-called "Expert" mode). A parental control mode will be available, as well as different security features (firewall, antispam, etc). Usage will be restricted by Neuf so that people won't be able to install applications (or viruses!). On the hardware side, it will feature an Intel Celeron M 600Mhz, 512MB of RAM, 512MB of Flash memory and no hard drive. There will be 6 USB and 5 ethernet ports, and acting as a NAT router, it will share the connection with WiFi-enabled devices too. The modular design of the NeufGate will allow future hardware extensions (harddrives? DVR features?). The box will be rented (cost included in the monthly fees): the operating system will be automatically updated and most problems will be remotely fixed (some of them without having to call the hotline, as the box will report errors; it will be remotely controlled by Neuf technicians on demand [you will have to accept, as they won't be able to access anything other than your NAT/router settings otherwise]; and no, you won't be root ;)); in case of hardware problems, the box will be replaced within 48 hours (hotline will be free). A 2-hours online tutorial will help new users understand the basics. Of course, it comes with the current Neuf "triple play" offer: 8 Mb/s ADSL (down, 1Mb/s up), Telephony (mostly free, at least to landlines in most Western countries) and IPTV (to be available early 2007). All the software used in the NeufGate will be available as F/OSS on their community website soon. Oh, and the price? 39.90euros/mo, everything included (except the peripherals, ie monitor/mice/webcam which will be sold separately; you can use your own). More pretty pictures here (still, still in French). Now, isn't that what we can call Linux Desktop for Aunt Tillie? :)

actually there is already such an offer here in france from isp neuf telecom ... afaik it was launched 1 or 2 months ago

I couldn't find anything at Free's site, but for the Neuf offering you'll need at least 5mbps. And the two services seems to be mostly similar.
http://offres.neuf.fr/offres/television/Questions- reponses.html

"Where else do you see IPTV right now?"

Here for example:

http://www.neuf.fr/offres/43/45/47/50/52.html

(For reference, let's review the procedure for obtaining broadband in the U.S. Step #1: Call up your cable or DSL provider, walk through the options, and decide what you want. Step #2: Receive and install the modem, or have an installer do it for you. Step #3: There is no Step #3!)

Oh, yes there is. Pay, pay, pay, and pay some more. 512kbps/256kbps broadband for my parents in KY? $45/mo. In France, I get 8Mbps/512Mbps ADSL for 15Euro/mo ($20/mo) or 20Mbps/1Mbps ADSL2 for 30Euro/mo.

Sometimes you get bad luck, and that's all there is to it. But I'd rather have a run of bad luck, and pay next to nothing, then have it instantly work, at miserable bandwidths, for gobs of money. It's amazing what a little bit of competition combined with a sensible urban growth policy (basically NOBODY lives more than a few km away from a DSLAM) gives.