Cheapo lap top will almost certainly not play HD video well. I had to go all the way to a Quad core 2.83 GHz, to play AVCHD video files as well as the WDTV player.
Most HD video formats, particulary AVCHD, require a lot of computer 'grunt'. The chipsets in the media players are designed just for that task, so make light of the amount of processing going on when decoding HD video.
I can understand your problem ..I too have a wife who just doesn't understand why
so many boxes are essential!
The WD player isn't very big though -only about 2" x 4" x 5".
If you do decide to buy a Blu-ray player, remember that it is possbile to make 'AVCHD' DVDs, that will play back, in HD, from standard DVD blanks. Obviously less room than a Blu ray disc, but the blanks are cheaper!
Again, the bundled Panasonic camera software allows you to make and burn such discs, using a standard DVD PC burner - again no need for the cost of a Blu ray burner.
Whether your Canon software allows you to do this??