I think the statement that the system was for your parents and they are not that picky in your original post may be the key to the whole thing. Throw in easy to setup and operate, too. I think you could find separate pieces (i.e. Axiom, Denon, Yamaha, etc...) within your budget with some careful shopping. You will have to figure in money for audio/video cables and speaker wire, too.
However, I am wondering about you looking into the dreaded Home Theater in a Box. I just looked on crutchfield.com and found an Onkyo HT-S780 which is a 7.1 system for less $429.99 US. There are quite a few of these types of systems around. I am very leary of most of them, but this one received decent reviews from people that had purchased it. I would buy better speaker wire if the supplied wire isn't 18 awg or larger. (purchase at least 18 awg - as long as the terminals on the speakers and ampilfier will accept it)
Anyway, that is my opinion....at the very least, I may have stirred the kettle enough here and we'll get some people firing on me and throw in some other ideas for you.
