You can play WoW on your 60" HDTV and stream movies from netflix ect. The old Mini was right at the edge of playability but with 2x the graphics it should work just fine.
PS: You can buy a 60" 1080p TV for 800$ so if you can afford this you can afford an huge TV.
The type of consumer that wants to stream Netflix and play games on their TV is just going to buy an Xbox 360 or a PS3. The demographic you're talking about isn't the type that's going to want or care about having a full fledged computer in the living room.
You can't play most MMO's on a PS3 or Xbox 360 and MMO don't need great graphics so it's really a fairly low handing fruit. Most of them also support digital downloads so lacking a DVD player is not an issue.
Anyway, I have a Mac mini, play WoW, have an HDTV and I would really like it if I could use it to play on my TV.
I'm not actually sure. This reads discs, but Apple's never been much into discs anyway. Also I know a low of underspeced devices have trouble with decoding HD content at acceptable speed, but I;m not sure if that applies to the AppleTV or not.