Someday I'd like to do something similar to a Dreamcast (or at least, the casing). I know it's been done before, but not properly. Personally, I'd like to retain the flip lid DVD drive. I suspect that means gutting a laptop DVD drive, and mounting that in place of the original mechanism.
It'd also be nice to keep the original controller ports the same, but that's a fair chunk of work. As the DC already has a keyboard and mouse, as well as standard controllers, it'd probably end up being a USB to maple converter. Output would probably have to be via the existing AV connector, just to keep the looks.
The Mini-ITX boards so far aren't quite small enough, so perhaps it'd have to be SOM or Nano-ITX. Power supply boards should be less of a problem though.
Hard disk would have to be something small I'd guess, probably 2.5" or 1.8" drive?
No, I'm probably never going to get around to it, but I hate 'mods' that don't take form into account. Who cares that you can cram a Mini-ITX board into something when you have to have a great wacking PSU sitting next to it, or that you totally destroy the lines of the system by taking huge chunks out of the plastic.