HTPC on it's own or DVDO Hybrid ?

Just wanted to get a few opinions on what the best setup would be to get the highest quality result based on the equipment I have. I am just assembling my first HTPC. The setup I have used up until now has been :

Current Setup :


Panasonic DVD S97 (SDI out) -> (SDI in) DVDO Iscan HD+ (SDI out) -> (DVI in) Optoma H79 DLP

I have finally decided to build an HTPC as I've built a few non-HTPC systems in the past and wanted to rip all of my movie collection onto hard-drives for instant access and to take advantage of the additional features and perks of a dedicated "Media-Box" using a front-end such as Meedio.


All my parts have almost arrived and so I will be assembling it in a few days. My HTPC will consist of :

HTPC Setup :


Case : Zalman HTPC HD160XT

Motherboard : ASUS M2N-SLI Deluxe NF570SLI (passive cooled Northbridge)

CPU : AMD Athlon 64 X2 3800+ 2.0GHz

CPU Fan : ZALMAN CNPS7000B

Power Supply : Zalman ZM600-HP 600W Dual-Core

Graphics Adapter : GIGABYTE GV-NX86S256H 8600GTS (passive cooled)

Audio Card : HT OMEGA CLARO PCI

Hard Drives : (x4) SAMSUNG SpinPoint T 500GB 7200 RPM 16MB SATA II

DVD Drive : PIONEER DVR-112D

Memory : (x2) GSkill 1 GIG DDR2-800 ram

Wireless Card : D-LINK DWA-556 11N

Keyboard : LOGITECH DINOVO EDGE

Front End : Meedio

Software Player : ZoomPlayer

Ok...so my question is...based on my HTPC setup (as a general guess from the knowledgeable) would I possibly render a better picture utilizing either :

A) HTPC (DVI out) -> (DVI in) DVDO Iscan HD+ (DVI out) -> (DVI in) Optoma H79

...where deinterlacing is handled by the HTPC but upscaling is handled by the Iscan HD+


or

B) HTPC (DVI out) -> (DVI in) Optoma H79

...where all the deinterlacing and upscaling is handled by the HTPC and the Iscan is out of the loop.


I'm asking because I already have the IScan so if it does a better job of the scaling aspect or has other advantages of "being in the loop" while still using the Nvidia TrueVideo processing for image tweaking, etc., it would be no hassle for me. This setup would obviously take a bit of load off the HTPC. Although I know the HTPC has plenty of power to render a great image on its own (as the H79's native resolution is only 720P so HD is not an issue right now), would having the Iscan HD in the loop bring any advantages to final picture quality by its dedicated circuitry or by distributing processing load ? I'll still use it when I want to use my S79 but does it make sense in the HTPC-Optoma loop based on my configuration ? Please anyone chime in...this is my first HTPC venture so I would love any and all thoughts on this...


Thanks !!