So I've been thinking...
You can get an old wireless g airport express with a USB port and audio output. (Also it has 100 mbps ethernet so you could do that as well) for $40 on ebay
So if we buy say 8 of them thats $320 (the price of 1 Squeezebox)
Then we buy 8 cheap 100 watt car amplifiers on ebay for $80 each on ebay. ($640)
Then you plug each of them into a pair of speakers in each room and boom whole house audio!
There is already a linux project to stream live audio to Airport express. (http://nanocrew.net/software/justeport/
It would only be a matter of getting linuxmce to recognize them as media directors.