The problem with the WD TV Live is that is DOES have a number of outstanding issues / bugs and, if you’re affected by several of them, it makes the Live an unsuitable purchase.
Personally, the Live works well for the files I play and for the uses I have for it. It’s used daily and I rarely have cause for concern. But my uses are limited to watching MKV files and AVI files, only occasionally MP4/M4V. I don’t listen to music much (apart from Pandora, which works great, as do other radio stations streamed via TVersity) and I never view pictures.
If you want a box that does movies, music and pictures, all exceptionally well… I’m not sure one exists yet.
My gut feeling is that the most promising media player has yet to be released (D-Link’s Boxee Box). But it will be considerably more expensive than a WD TV Live (same as a high-end Popcorn Hour). It’s essentially PC hardware running Boxee, a software solution that should have no trouble playing the vast majority of files and should cope well with most internet video / audio streams. You can even download Boxee and test it out on your PC for free.
My opinion is that WD made a mistake in marketing the WD Tv Live as an all-in-one wonder box. It’s not. If you accept the limitations, you’ll be very happy with the unit. If it simply doesn’t do what you want, you definitely need to look elsewhere. Good luck in your search and be sure to update us if you find anything you feel is a better alternative. I’m happy with my Live but perhaps others would benefit. ;)