Lol, I'm a poor kid only mate. I've got no idea how to design my own USB hub.
And my soldering skills are pretty bad to say the least.
But you could link me/help me design, I'll really appreciate it and will buy you a cuppa!

Yes, RPi is powerful enough for playing AVI-contained movies encoded in Xvid @ FHD 1080p resolution.
However, when you access the menu/OSD/on-screen display while the FHD 1080p (AVI/Xvid) movie is being played, it (movie) will stutter every 5 seconds.
The reason I downscale to HD-Ready 720p since my source is FHD 1080p is because to play FHD 1080p it's quite processor intensive towards the RPi, causing video stuttering and I hate video stuttering while accessing OSD (to seek/fast forward/rewind/subtitles/audio video settings, etc).
This is a drawback because it's only RM111 of hardware. These are some acceptable trade-offs as expected. Furthermore, I don't notice the difference between FHD 1080p and HD-Ready 720p. When your RPi is running @ HD-Ready 720p @ 60Hz, everything is smooth as butter!

Haha! I'm gonna build mine this week I think if I have time to go to Jln pasar..will post a pic of it when I'm done