Yes. Install a HD in it (it doesn't come with one). Format and partition the HD. Connect it to your PC via USB, drag and copy the files over. Connect to your TV via composite, S-Video, Component, DVI (only the 350-HD). Make sure the files you want to play have the proper codec. Most of these play Divx, Xvid, avi's, etc. Doesn't play h.264 or mkv's. The one I linked is the basic 3.5" HDD version, you can get that for around $100-120 w/o HD. There is a smaller one that takes 2.5" laptop drives for around $70 and a HD version that will play back certain HD content, adds DVI output, and playback for WM9.
These are much better at playing back video, they playback audio (but shouldn't be used as primarily an audio system) since they don't take ID3 tags and the imagine having to flip through thousands of songs. They also can view pictures, but jpeg primarily, I don't think they view .gif's and only the later ones show .bmp's.
These systems aren't perfect but for the price it's not bad. There's other options at different price points if you want to know more about, PM me.