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| Remember hard drives are NOT quiet and I am pretty sure even the quiet ones will be louder than any decent PSU fan |
Wrong. I've got a few Western Digital greens, and virtually zero idle and seek noise. They're quieter than a quiet PC PSU.
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| But why the emphassis on small and quiet? |
Because the TS-119 is both. It's quiet and small enough to in your Hi-Fi room. A computer cannot be cheap, small, powerful-ish, low power consumption, and passive cooling. Haviing no case fan will probably result in a internal temp that's a bit too warm.
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| You could underclock and undervolt |
Then you need a motherboard with those features, I've found MATX boards pretty basic in clocking functions.
And what about when you need more power when doing database scan? Go into BIOS, reset settings, reboot, do the scan, reboot go into BIOS and use low power modes. lol.