With the Broadcom Crystal HD hardware decoder (a.k.a. BCM970012), it can be installed into a mini-PCIE/Express Card/PCI Express slot and will provide hardware decoding support for up to 1080p videos whether it be MPEG2, H.264, or VC-1 formats. While Broadcom used to be notorious with regards to their Linux support, the Crystal HD is backed by a fully open-source driver.
The Crystal HD card can also be used regardless of what graphics card you may be using. While NVIDIA's VDPAU does a phenomenal job in offloading much of the video decoding and processing to the graphics processor, using the Broadcom Crystal HD can be used with or without a NVIDIA graphics card and also does not require any binary-only drivers like NVIDIA's driver.
The Crystal HD decoding support will be found in the next release of XBMC and will work on Linux / Windows / Mac OS X platforms. FFmpeg, Xine, MythTV, and other open-source multi-media projects are expected to soon pickup support for Broadcom's Crystal HD hardware decoder as well. More information concerning XBMC's implementation can be found on their blog.