I'm curious about it as well.
Last night I hooked up the XP Pro to a Dell Optiplex 600 MHz (with integrated video) and ran it to my Toshiba 27A34 via component cables.
In Windows mode, it looks kinda crappy (hard to read text, not so crisp). Of course, that's comparing it to the 17" flat panel sitting right next to it. Is that pretty much how all TVs look running Windows, regardless of the video card/type of output? But in MAME, I tried Galaga, and I think it looks okay.
I'm NOT planning on using this computer as my MAME machine, just doing some testing. But I'm curious as well.....
Will a nicer video card (anything's better than this integrated video, I'm sure) make much of a difference? The video looks great on the computer monitor though.
Also, to get Galaga to fill up the TV, I had to set the resolution to 800x600. But, when I hear everyone talk about the ATI/dongle combo, I keep reading 640x480 or 640x432, so I'm confused.