I've done what you are planning to do now for many years. For the last 3 years my extenders were Xbox 360Ss. I never had an issue with the noise on them. The original Xbox 360 is another matter which sounded like a jet taking off.
However, in the last month I have decomissioned the Xboxes and have now moved to a setup built around XBMC clients with Win7 MCE as my server. Setup is as follows:
- Core i3 Server with 8GB RAM, 128GB SSD system drive, 8TB storage. WMC configured and Server WMC installed (enables XBMC to connect to WMC: http://wiki.xbmc.org/index.php?title=ServerWMC
- Clients: DN2820FYKH Intel NUCs with small SSDs and 2GB RAM running OpenElec Gotham Beta and the PVR client for Server WMC
The main advantage of this setup is that the media library is handled much better than WMC. It is vastly quicker with large collections of movies and music. TV handling is not quite as good as in WMC. The main issue that I have is that watching a programme that is currently recording can be tricky, but this is apparently just about to be fixed with a new Server WMC (http://forum.xbmc.org/showthread.php?tid=189065
My wife completely unprompted last week said that she preferred the new setup to the old one. I think it also helps that the NUCs are far more discreet than "that horrible black Xbox".
I do still think a WMC extender handles currently recording TV better. In every other regard I get a much smoother experience using XBMC as the client.