I think among all the available options you have the best is to take help of IIS smooth streaming that is supported by IIS 7 recently released.
I have worked on it and it is very easy to work on for a .NET developer and it automatically adjusts its streaming quality based on the speed.
You need Microsoft Encoder and IIS media services to do that.
Check this video for details
http://debugmode.net/2011/07/23/video-iis-smooth-streaming/[
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Here is the link of actual download :
http://www.iis.net/download/SmoothClient[
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And here is a great player that is shared free for you.
http://smf.codeplex.com/[
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Thanks