If you want to use the 5 PCs as Sources, then you would have to route the video / audio from the PC graphics / sound card back to the matrix switch. You will also need a means to control the PC from the Watch locations. That can be a wireless mouse, a software based touchscreen system, and very very limited purposes, an Infrared Remote control (via an IR network). This is pretty non typical solution.
You might want to put one or two PCs as sources installed in the rack with the matrix switcher. Use the room local PCs as "HTPCs' for content presentation and local computer use. For media management in a distributed environment like this, this is where the better "front end" software solutions come in like MainLobby and CQC.
You can also use a LCD / Plasma in a Watch location and view content served up by one of the central mounted PCs in the equipment rack (via the matrix switcher). Again, you will need a way to interact with that PC source via a wireless mouse, or a touchscreen software solution.
You can also leverage the multiinput capability of most LCD's Plasmas / Projectors by having the local PC output to the display device on one input, and the matrix switcher output going to a second set of LCD inputs. The TV input can then be controlled via RS232 (better TVs) or at a minimum, Infrared (via an IR network like Xantech). The PC can then orchestrate all of this switching stuff with an IR hardware transceiver (like Cinemar's USBIR6). Then, the person wanting to watch a program doesn't have to know the guts of the system to watch their movie.
You can't really use a network cable from PC to matrix switcher as the matrix switcher typically doesn't render audio or video from a IP LAN. Devices like Sage's HD Extender do that, but that is another ball of wax to figure out how it fits.
Problem with this stuff is there are dozens of ways to watch movies at a given TV...