My current progress is that I need to change from my current monitor. It looked better on my TV upstairs. It is either the dvi/hdmi adapter or the monitor.
Monitor status: ONGOING
24" Dell / I don't like the way it looks
19" HP/ Only has VGA, need VGA to DVI (single) adapter.
UNTESTED: 22" ACER, 19" Emachine
Storage status: ONGOING
When I installed it earlier, it was before the update supporting mass storage.
Other Challenges: ONGOING
Pick software.
I've got an OUYA.
My kids love it for n64 emulation & we play bomb squad.
They are 5 & 7 so the Wii & OUYA really are perfect for them & me.

I haven't done too much with mame on it yet.
I've been playing with my PI for my older games right now.
I did get Tekken 3 I think to run with final burn but it ran in slow motion. it's a newer romset though.
I have the .139 set for mame4all but haven't installed it yet.
I've done the one-click root plus added the mod so you can adjust overscan & force output to either 720 or 1080.
Monitor:
OUYA did not like the 4:3 panels I plugged it into with an hdmi-dvi adapter.
doesn't seem to recognize a 4:3 display.
I do have it on my 50" 720p Plasma & I think the games look really good at 5-10ff despite needing the aspects adjusted a bit and the giant black spaces on either side of the vertical games.
But, I haven't had time to configure everything.
Storage:
I have an 80GB hd in a usb case attached to mine.
Software:
I can't see your video's at work but if you haven't tried it, check out the nostalgia front end in the OUYA store.
I like it. Only $1. I actually think the dev should ask for more.
free version will let you use one emulator only so you can try it out for free.