the video station in DSM 6 is great for streaming, it works perfect with any supported device and you can also use offline transcoding.
i don't know what your budget is for this project but there are many popular hardware on this board, just do a little research and you will find the perfect match to your budget.
transcoding your media using handbrake to mp4 format is the best/smartest way to go, why would anyone wants to transcode the same file over and over again! your 1.5TB coversion will free up +- 1.2TB of space depending on what format it is in right now
are you streaming locally or over the internet?
are you familiar with kodi? combination of kodi and NAS is a killer setup for media streaming!