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Out of all the audio and video gear. ATV2 and 3 gets my vote as the biggest bang for the buck for both audio and video usage
Free content just includes YouTube, Vimeo and whatever you can load into iTunes. Occasionally you can snag a pilot episode for free. There's also a weekly $1 movie that been hit or miss with me. You can also consider using Airfoil devices, that might allow you encode flac on the fly and stream it to the ATV. Also there's really no hi-rez support after 48khz files.
Here's why. See this:http://firecore.com/Ron
ATV3 worth the 99 bucks, wish it would have an analog output AND be able to beam more than 16/44 so I could use it with my small system in the bedroom without a cd player. That would be my only request... 96/192 or something better than redbook
Just a heads up, while I love my Apple TV and have had 1st through 3rd generation units. The 1st generation is the only one to have 44.1khz output. Both iOS units only output 48 kHz.