It kills me to say this... but I use Windows Media Center on a PC and it works well.
I put an antenna on the roof and I get all the networks, plus a few independents and PBS in HQ HD.
Then I run that into a tuner card on the PC, and WMC is a surprisingly excellent DVR to record programs I want to watch and time shift.
WMC includes some internet TV stuff, but it's awful. Instead, I added plugins for Hulu desktop and Boxee so I can stream all kinds of web-broadcast TV.
And WMC includes Netflix natively and I stream a lot of that content for 8.99 a month.
So.. the equipment I got:
Acer AX1301-U1302 - silent, HDMI out, and lots of bells and whistles - refurbed for $300
ATI HD600 USB tuner stick - says it doesn't work on Win7... but it does - used for $35
Channelmaster antenna - stuck on the old DirecTV pole on my roof - $40
Then I pay $9 for Netflix, and $25 for DSL per month. So I should have ROI on cancelling cable in less than 4 months.
And you'd be surprised how little you miss it. Most of the cable shows we had on were background noise or time-fillers. That kind of stuff is easily replaced without effect.
Oh, and Boxee has an app for Justin.tv in case I need to see the cable-only football games. Its just a matter of time until someone makes a better webcast of those games. MLB.tv is already an official plugin for Boxee to watch HD streams of any game.