Mine is set up using an All-in-Wonder with TV in/out.
Plays through a 17" TFT without a problem, however this only applies to channels 1 - 5. I also use NTL cable TV but I find that I have a problem with the sound on that so I simply don't use it.
The only time I watch TV on the PC is when I am working and waiting for the start of a particular programme...I set the TV to "always on top" and shrink it right down to a 2" screen.
Main advantage of TV on the PC is for video capture - in my opinion.
Connections are the same as for a TV - plug the standard coax plug into the graphics card and set up the channels using the software.
Hope this helps