I'm using a wireless feed. I have not installed a HDD yet. The PBO gets pretty warm, but it is not really hot. You can easily rest your hand on the top of the case.
With a little further testing it appears this is an HDMI/wireless issue since I can get sound if I switch to the regular video/audio outputs. I'm not the only one having this problem. Another person posted with the same problem.
http://www.patriotmem.com/forums/showthread.php?t=4162
I still haven't tried it from a USB drive, but I suspect it will work. I should be able to get to that tonight.
I'm wondering if one of the alternative firmware loads might help?