Apple has dusted the cobwebs off of Apple TV with a new software upgrade that introduces a redesigned user interface, which is intended to make it easier to play favorites. iTunes 9.0.2 was released in conjunction with the update.

Apple TV 3.0 has a redesigned main menu that adds shortcuts to recently rented or purchased movies. TV shows, music, podcasts, photos and YouTube are also front and center.

In addition, iTunes extras and iTunes LP content can now be played on the Apple TV in full screen. Genius mixes and Internet radio can now be played through home theater systems. The iTunes upgrade adds HE-AAC playback and encoding.

Apple TV 3.0 is a free download for existing customers; new 160GB units cost $229. Last month, Apple slashed the Apple TV’s price, and increased capacity.