I have both a PS3 and a WD TV live and I enjoy both of them. However, I use my PS3 mainly for gaming and the WDTV as a media player. If you do not want a game system and do not need a Blu-ray player I would recommend saving some money and purchasing a media player like the WD TV live plus.
BTW the price for a PS3 recently dropped to $250, if you have any interest in gaming (which it sounds like it is not the case) you can have a lot of fun with a PS3.
Despite its lots of issues, the LIVE is a **bleep** of a lot bang for a buck. And the fact that the PS3 does not play a lot of formats which needs you to convert them should answer your question (who buys from Sony anymore?).