MCE 2005 OEM installs just fine.
All you have to do is use an external drive to hold install disc 2 during the install. It can be an external CD/DVD or a HD with the contents of disc 2 copied to it.
When the install process asks for XP disc 2 , just hit OK and then change the path to the external drive, in my case it was D:.
The Apple drivers work just fine as well, and if you have the Microsoft Remote and sensor it works great.
I set it up on a Mac Mini which I think makes a perfect small silent media computer to hook to a HDTV.