Depending on the RAM and disc space available in the computer, I'd suggest installing Linux Mint. It can be a bit resource intensive (I believe they recommend 1 GB of RAM). Barring that, there are other Linux distros that have a much smaller resource requirements. You might even consider an older version of Linux Mint. I don't recommend Ubuntu, fwiw, as it contains spyware.
On a side note, if you don't need this machine for use as a PC, you can instead use it as a Home Theater PC (a DVR, essentially). There are plenty of free operating systems that make this possible. One of the most popular is MythTV or MythBuntu. You'll have to have a TV tuner card, though. Again, this all depends on the specs of the computer.