See my recent writeup on CMC:
More thoughts on Theater Pro 650 & Catalyst Media Center
Nothing on theater mode as I don't connect my PC to a TV but it might give you an idea about the overall usefulness of CMC.
Also, if you have or are upgrading to MCE, I'm not sure if you'll really need CMC, since it appears to be pretty full-featured as a media front end.
Although, since I'm planning to upgrade to MCE from XP Pro myself, I've got to say that one feature that I'm going to miss is PIP, which it lacks for some reason. CMC has it. Seems like a no-brainer feature to have. Perhaps there are technical issues involved.