Yes I agree, the device I'm suggesting should be DLNA compliant. And it'd be great if WP7 was DLNA compliant, but even it it wasn't it would still be usefull to be able to stream music from your PC to a DLNA wifi device with audio output going to your stereo, and use your WP7 as a remote. Apple has this functionality via iTunes+AirportExpress, and you can use an iPhone or iPodTouch as a remote.
As an aside, there is a program called Airfoil
, its makers claim it lets you stream audio from a PC to Apple's airport express without having to use iTunes. I wonder if anyone at AnythinkButiPhone feels like testing this out. I'm very temped to just jump in and try it. If WP7 had a remote control for WindowsMediaPlayer on the PC this would accomplish most of what my suggestion proposes.