Hmm, this is gonna be tough. For starters, and others will have their own opinions, I would eschew the center channel for now. You can do fairly well running front channels and a sub. Run the fronts in phantom mode to simulate a center--on a budget this is a good compromise.
I'm thinking small speakers like Axiom M2s or M3s can work. You can go factory outlet to save more.
If you shop around, you can find good DVD players for around a hundred or less.
Go to
Monoprice for cables.
Sub is tough. Something like the AV123 x-sub is inexpensive and quite capable for your small room.
As for the surrounds, use any little speaker that makes sound. At least you can get a hint of surround sound. You can always upgrade later.
With a small budget you might want to think of starting to build in stages. You can add a center later. You can change your fronts and move the M2s to the back. Buy good bits and pieces where you can rather than getting one entire mediocre system right now.
