FYI I sold mine on eBay for $150. The original price was $99 and I had this Apple TV for many years, maybe 3 or 4 years in fact. So Overall I think I came out on top!
So what do you need to do? It's quite simple really, jailbreak the Apple TV, and install Kodi on it.
This will only work on Apple TV 2, if you have a newer unit you're out of luck.
To jailbreak the ATV2, you need a micro USB cable and Seas0nPass.
Connect the ATV2 to your computer, follow the Seas0nPass instructions from the link above and after a few minutes you will have a confirmation saying that the firmware has been updated. Now the ATV2 is jailbroken and ready for Kodi to be installed.
Kodi installation is very easy too. Just follow the instructions from the Kodi wiki.
I had the ATV2 connected to my Dell U3415W monitor using picture-in-picture (PIP) mode so that I could see both the instructions and the ATV2 display at the same time.
Here's the ATV2 being set up and the Kodi app appearing in the applications list after a successful installation...
Launching the Kodi app takes a few moments. I noticed that it crashed the ATV2 the first time. Also if you enable the thumbnails view when browsing videos it tends to crash as well. This is due to the limited memory that ATV2 has.
After adding my video sources the ATV2 had no issues playing a HD movie...
The only downside is that the ATV2 maximum resolution is 720p so watching higher definition content doesn't make too much sense as it will get scaled down.