Since OP and most of us to not mention if they would use a paid OS its becomes a bit obvious to assume it would be downloaded. However the best part with XBMC is that is is available for Linux as well, and so if once decides to install Linux he can go ahead with the Linux version of XBMC making the entire package legal and free as well.
Any suggestions on which flavour of Linux goes well with Zbox? Ubuntu /Red Hat? Anybody has an experience with linux configurations for rich multimedia experience?