Advice on Upgrading My PC and Building a Console-like Setup

I'm looking to upgrade my current PC and also create a second, smaller computer that would serve as a console to run Bazzite on my TV. My goal is to build something compact, ideally in a small form factor similar to a PlayStation. I've checked out some options but the prices and specifications for new parts are a bit overwhelming, especially since I haven't kept up with the latest CPU and GPU options since I built my last PC in 2019. I'm aiming for a budget of around £500 and would consider used parts. Can anyone offer guidance on good CPU/GPU combos for both PCs? I'm particularly interested in achieving good performance at 1440p for my main PC and 1080p for the TV PC. Thanks!