Zune should work out for you, though I don't think it supports HD videos. But it will transcode HD (WMV, MPEG-4, H.264) video for playing on it.

While you will need to use the software that contains the Zune Marketplace (much in the same way as iPod/iTunes) you don't necessarily need to pay for a subscription. The advantage of the subscription is that you can download as much music as you want, though you won't be able to keep them all if you stop playing. They will become unplayable after your subscription expires. However, you can keep 10 of those songs to put in your permanent collection. But if you don't like any of the music in the store, then a subscription is of no use to you.

As far as I know, it has neither Microsoft Office capabilities nor internet browsing.

http://www.zune.net/en-us/mp3players/zune120/features.htm

http://www.zune.net/en-us/mp3players/zune120/specs.htm