I have an old laptop that wouldn't play DVD's properly due
to low memory.
It has 384 MB.
I finally ran across vector linux lite,which uses icewm window
manager which is easy on memory.
Vector lite also has codecs automatically installed and allowed
me to configure the video at install where other linux vesions
didn't.
There is also this light weight version that only does medis and
uses a small partiton.
http://geexbox.org/en/index.html
This can be used as a standalone media player without having
to boot a full operating system.
It can be installed on the hard drive.