lol good luck. i have been looking for the same thing and am actually thinking about getting a refurbished/factory reconditioned component system since HTiB's are sooooo crappy. I am either going to go w/ Onkyo or wait for the new Pioneer's coming out. Unfortunately, all the new systems are starting to have shortcuts w/ crap plastic speakers and speaker connections that are a new kind of plug that resemble usb ports - panasonic, samsung, pioneer, sony, etc...
Onkyo 575x --- Ebay --- 220. sony swm40 --- Sears--- 150. psb intro clr --- Ebay --- 150.(pair) old sansui's for fronts 00. old sansui (center) ---goodwill 06.
I originally bought the pair of intro clr's to use one as a center and sell the other, but they sounded nice as surrounds. I'll be moving up to Seattle in a year and hope to pick up some more PSB's for fronts and center then.
We also just bought a 36" direct view Panasonic flat screen for 899. I am having second thoughts about this as I just found out I can get the Panasonic 47" rear projection widescreen HD ready for the same price through a friend of a friend who works at CC. The Direct View does look nice, and my wife watches mostly network television. The same dilemna many people seem to be having.
JBL NSP1 (or NSP1 II) set, a cheap but solid sub (the aformentioned Sony SA-WM40 if you can find one), and a lower-end Pioneer, Panasonic, or Sherwood 5.1 receiver with DTS, Dolby Digital, and Pro-Logic II and you should be set. That should be attainable for just under $500.