yea, that will work.
I have used a Radeon All-in-Wonder card. Video in is cable and the tuner takes care of decoding the cable signal and displaying it. The Radeon card also decodes the DVD too; the new multimedia center from ATI is a much better piece of software than previous versions.
You can display onto the TV; the only problem is that you cannot switch the channels with the remote - you have to sit at the computer. Unless of course you have a cable box or some other way to switch the channel remotely
Video out is S-video, so you get good resolution on the TV. Audio can be handled through the TV or by a separate A/V system. It can be a pain in the rear to get all the sound levels adjusted right.
Not quite as convienent as splitting the cable signal to both the TV and the computer, but what the heck, it works just fine