Video Card recommendation

I'm looking to upgrade my Dell VGA/DVI dual monitor card to DVI/DVI
and HDMI output with audio. I have a home theater system in the same
room that I would like to utilize to view desktop content or Media
Center (Vista Ultimate). All at the same time I'm viewing dual
monitor set. Options I'm considering...

1. Get an MC extender such as XBox 360 and hook it up to home
theater. I assume I still have dual monitor to view and use. I don't
know if I can display content of my desktop this way, however.
2. Get a video card with HDMI and outsource the content with audio
that way. Drawback is that most likely one monitor is used as the
HDMI content (mirrored).

Any recommendation on option 2? And is there a way to display desktop
content via extender? TIA.