Your not really talking about an OS, to make an OS to support all that stuff from scratch is inconceivable.
What your actually talking about making is a front end, which is a great idea - especially when letting youngsters play games on your PC, in the safety of a walled garden kind of thing.
I would say that DBPro could do this quite elequently, but when you run a program (well before actually executing it) I would send the front end into a wait loop, but use the system friendly sleep command - this will free up your processor for the game you are running. Maybe the system just displays a 'press a key' screen while in a loop.
One thing to be aware off, and that's DBPro's love of killing it's media on minimize - to get around that I check for the existence of a known object and if it's gone, I reload and re-setup the media. This would make it much more robust and sensible. I tend to make a function to load and setup media and let it be called several times if need be - it's far better to go to those lengths than have a buggy system, so don't consider it an option for this sort of project, tis vital
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So the main thing is handling when it needs to run a program, because it'll handle everything else perfectly well - as I said make a little hidding place function, that will minimize and free up the processor for other things, pause music maybe, and sit in a sleep loop.
I plan something similar for my arcade cabinet - want to make a 3D arcade, explore it and find a game you want to play, find the jukebox to play music etc etc. It would be amazing if we could run an application and grab it's screen as an image
- imagine texturing a 3D monitor display with the output from a game, or YouTube!. My plan is for a mini Mame cabinet - like half size, but the same proportions etc as a real cabinet - have it on coasters, and it'll be a mame / media centre thing for my lounge. Whether it's sitting in the corner being a jukebox or in front of the couch playing Bubble Bobble. I quite like the idea of doing it myself instead of going for a pre-built solution (also known as a dreary old roms menu). I think it's a pretty good project that will open up a lot of avenues - as you'll have to cover different areas that will be useful knowledge for if you keep developing or start a game project for instance.
I can understand the reservations of using DBPro for this - but I really think that it's worth it for the sheer fun and ease at which you will be able to add your own things. It might get a bit messy when running external games, but when inside the system playing music and doing all the other OS'ish things, well it'll be great.