Happy to help...
Yes that is the correct Pi model.
You need a SD card to install the Rasplex or PlexBMC to. You only need the 8GB version. This one is highly recommended and it's only $9 ( http://www.amazon.com/Transcend-Class-Flash-Memory-TS16GSDHC10E/dp/B003VNKNEQ/ref=sr_1_1?s=electronics&ie=UTF8&qid=1384888470&sr=1-1&keywords=transcend+class+10
Since you are first starting out...I would choose Rasplex to start off. It's EXTREMELY SIMPLE and it looks great. You can also use an iOS device if you have one to control it via the iOS Plex software (I think it costs $3.99...its worth it trust me). If you have a TV that has CEC (most modern ones do) you can just use your TV remote to control the Pi as well. THE iOS Plex APP is AWESOME though. It's VERY VERY user friendly and great graphics for the poster art, etc. They also have one for Android I believe.
You do not need a keyboard OR mouse connected to the Pi at all!!!!!!!!!! You CAN use one if you want but I've never done it. To install Rasplex these are the basic easy steps:
1) Download the Windows Installer from the Raxplex website.
2) Run the installer on your Windows PC
3) Insert the SD card into an SD card reader on your PC
4) Tell the Rasplex installer where your SD reader is when asked
5) The Rasplex software will copy
6) Plug the Pi into your TV/receiver with a HDMI cable
7) Plug your network cable from your router to the Pi
8) Plug your SD card into the Pi
9) Plug the power supply into the Pi
The Pi will power up and it will start to install all the needed Rasplex files automatically. You do not need to do ANYTHING during this process. When it's completed it will reboot and you'll get the main Rasplex menu screen. Initial install takes about 5-10 minutes.. Just be patient. Also when you first start browsing your Plex library on your PC it will take a while for the files to cache onto the SD card in the Pi.. Once everything caches it will run a lot smoother since the poster art will be on your SD card and cached.
I'm not kidding when I tell you ANY novice can do this with Rasplex. Just make sure you have Plex Server (free) running on your PC. Rasplex will either automatically find your Plex server on your PC or you might have to input the IP address into the Rasplex menu once it's all installed.
The great thing about the Pi is that you can do many many things with it. You can either purchase a few SD cards and install different programs/apps, etc. or you can simply overwrite the previous software and start fresh. If you use the Installers it's really so simple a 14 year old could figure it out in 10 mins.
You may have a few questions when you first start using it but everything is extremely user friendly and it wont take you long to figure out. Don't worry about needing a keyboard/mouse hooked up.. You DO NOT need to use either AT ALL.Edited by NavySeal - 11/19/13 at 11:31am