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CNET has rated one standalone as being a better Blu-ray player than the PS3 in their tests... but it sells for over $500.  The only downside to using PS3 for this function is that it loads discs slower than standalones.

EDIT:  Actually there's one more potential downside: if your friends want to control it with a universal IR remote like Harmony, they're probably out of luck unless they buy a fairly pricy converter thing.  PS3 is bluetooth.  I think some Sony Brevia remotes work with it, maybe.  Or maybe not.