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What is the version you are trying to install? 0710Beta3 or 0704?

If Kubuntu installs without a glitch I would personally go for the CD install, but if you are unable to get the CDs... hmmm

This is a bios setting, you have 'accidentally' put in a new 'sda1'.
No worries, either change their order in the bios or physically on the connectors

I think that anyone in this forum would have to admit, that in 95% of the cases, there is no way that one could, in a few hours, have the whole house solution set up and running, with media center, security, telecom etc...

If you only use proven supported equipment, then sure, no problem, if however you decide to toss in a GeForce 8400GT or use the 0710Beta3, then you should not expect to be able to do this.
The video is made by Paul using some Fiire equipment, and some other stuff. But it was also the hardware LMCE is written for, so it should of course work.
There is a few things not mentioned in the video though. for instance the need for two NICs, LMCE setting up as a DHCP server, pluss other points, but those can be easily found by looking trough this forum or the wiki.

It's not like VistaMCE works on all hardware either, not even supported hardware at times, then again, this is not a simple Media center either.

Sounds to me like you could have the classic "two DHCP servers syndrome"
Are you sure the camera is on LMCEs internal network? the one that is served by the LMCE DHCP?

I don't know if LMCE can use an NTFS drive, but I'm guessing that as long as the OS can handle the file system (and I believe that 0710 can, even in read/write mode) then it shouldn't make any difference. The pnp is triggered off the fact that it is a new USB device arriving, and it should determine the file system type on its own and mount it like any other.

LMCE 0710 should be able to use the NTFS disc, until then 0704 can read from NTFS, but not write to it, therefore you can not use the external disk with a 0704 install

0704 doesn't read embedded id3 tags, I did seem to recall (iirc) that this would change with 0710, but I don't know if it has.

I have added a couple of stills from TV-shows as icons, and they have carried over between installs.
Never had the time to bother much with the music (mp3s), so I don't really know.

I am totally new to this world and totally unskilled, nevertheless I decided to move from Windows to Linux
and try to set everything up ...
Btw, the orbiter start from KDE isn´t successful, I guess it depends on the network problem, am I right ?

Could you copy/paste the output of the "sudo ifconfig -a" command  in here, so we can have a look.

On the KDE "bar" there should be a "terminal" (quite easy to find), run that and input the command Zaerc mentioned. Also, cut'n'paste doesn't use the same key combinations that Windows uses, so if you are (as you claim) unfamiliar you can use the same "right click" then "copy".

Don't know if this was too detailed, but better than the other way (unless one is easily offended )

Can you  please detail just what you installed and what choices you made during install?

If you installed Kubuntu 0710 you should be on the 0710 beta 3, am I correct?
If you did install (or try to) LMCE 0704 on top of Kubuntu 0710 you will certainly get into trouble.

Please give us some more information 

Aren't subtitles embedded into the .divx container, not the same functionality with .avi

Ouch..
And to top it of, Fiire doesn't use the regular install or UI, they have their own to make it work with the Via. (probably the files they sent)
You might be better of finding some of Totallymaxed postings on building the Via drivers from scratch and dropping UI2 alpha (wich the Fiire doesn't really do anyway).

Doesn't the Fiire come pre-installed?

also does it automatically download movie posters and info for my movie collection.

As long as Amazon carries it it should pick it up, but it's not a perfect world.
In other cases LMCE will usually have you put in a title yourself instead of picking a totally random title that "kind of fits" (in my experience).

Welcome to the club, I do suggest you look a bit around and read up a bit on what exactly LMCE is, and how it can fit your needs the best.

You found the answer.
The DVD is bootable, but it is also only meant for "100% certain it's compatible" systems
The "Install KDE first, then LMCE" is the safer route if you are unsure all your hardware is compatible/tested with LMCE.

(unless it's a local install MD...)