Apple insider says it has the scoop on the AppleTV hardware:

According to those familiar with the component makeup of Apple TV, it utilizes a 1.0GHz Pentium M-based chip (code-named "Crofton"), which has been under-clocked to run on a 350MHz bus. The chip is based on Intel's pre-Core Duo "Dothan" core and includes 2MB of L2 cache.

Aiding the Pentium M in video decoding are a nVidia G72M with 64MB DDR2 video memory (essentially the GeForce Go 7400) and 256MB of 400MHz DDR2 main system memory, the latter of which is reportedly soldered to the logic board.

Meanwhile, the device's internal 40GB hard disk drive -- a 2.5-inch PATA -- serves as a local storage for 50 hours of movies and TV shows, 9,000 songs, or 25,000 pictures. Users can sync their entire iTunes libraries to the drive but will need an internet connection when attempting to play back licensed content purchased from the iTunes Store.

They go on to say there are 5 wireless antennas built in and that the USB port is for diagnostics only.

My immediate reaction is that this box is a hackers paradise. Look for dozens of hacks in the first few days they hit the street. The most obvious of course will be putting in a real hard drive.