It's a very capable entry-level receiver with some great features. I used to have a 125 before upgrading to the 330. Should be great if you can get it (refurb) for a couple Benjamins or less. Otherwise you might look into something like the digital Panasonic xr57(?), which go for about $220...
Like John said, with no bass management in the receiver, the speakers will get the full-range signal, and so will the subwoofer (you can engage the sub's low-pass crossover at its highest setting). Bass management would be ideal, unless you are going to run the speaker outs of the receiver...
Sorry. With lots of threads here and on other message boards, it can get confusing. If you like HK, check out the refurb models on their Harmanaudio store on ebay. You should be able to get a great deal on something if you look.
So this is just for 2-channel audio, for music? What are you using as sources? That receiver only accepts 2-channel analog inputs. Also, the manual for that receiver mentions nothing about bass management. If you are going to run the speaker outputs through the subwoofer, use the sub's...
Is it going to be just for music? You might look at the STF-2 or VTF-2 (or something like the X-Sub or ULW/UFW-10 from AV123.com), which would let you go a little deeper, but there isn't a whole lot of music that goes deeper than 30Hz, unless you listen to pipe orgrans. As far as...
Something like a pair of these: http://www.ascendacoustics.com/pages...00/htm200.html (or the 170SEs) plus a sub like this: http://www.hsustore.com/stf1.html (or nicer) and a nice receiver (like John Garcia recommended) would work great for near-field.