You wont be able to do HD over wireless G or N-Routers, heck I cant do SD over wireless w/o heavy pixelation every 5 secs or so.
I believe problem 1 was solved with the thread I posted a while back about being able to buy HD cable card support separately now
What ext. video card are you getting?
I don't have extenders so I cant answer your question regarding using the XBox as one. The TheGreenButton.Com site is a great MCE resource. I'm sure you'll find answers there. AFAIK yes, it's that simple; you need to config the main MCE with the XBOX ExtID and that's it.