My mini started it's life with a 1.6GHz core duo, and I got fed up with it stuttering through random files. It would play a file fine one day with mail open in the background, the next day, it would stutter. Installing plex helped, it seems to have much better codecs than perian. But it could now manage any 720p file I threw at it. Later, my 2.0GHz core duo iMacs gpu started acting up, so I robbed the processor and ram from the iMac and did a swap. My mini now plays 15GB direct blu Ray rips with full surround flawlessly through plex. QuickTime with perian installed and vlc still can't handle those files. Also it's running snow leopard now.
So it might be worth hitting eBay or craigslist to find a compatible processor or a cheap spares/repair early iMac and do your own brain transplant.