As another cost-conscious (er, cheap) music- and HT-lover, I want to make these suggestions:
1. Listen to the speaker mantra heard on this forum. You will notice this difference more than the other upgrades right now. Sub ($400), QS8s ($470), and VP 150 ($350) is a great foundation, and as others say, you should buy the best you will want now with the money you have now, instead of compromising and kicking yourself later. That leaves you $780 to spend (leaving aside the troublesome issue of tax).
2. Now I'd buy the Panasonic F85 DVD player. It has a five-disc changer for playing CDs, it costs $125-135 at many stores and Internet outlets, gets great reviews, and it will play pro scan DVDs, DVD Audio, and SACD along with the expected run of everything else. You will have one slim, well regarded unit that can play CDs, DVDs, and DVD-A once you have your speakers. By purchasing this, you'll save money without sacrificing quality. Many audiophiles will disagree, but I think so long as you purchase a good, solid unit with a proven track record (important caveat) at a reasonable price, you're fine. Beyond that, the gains in quality you see with higher priced digital components can be hard for anyone to discern, except the people who lay out $1000 for a CD or DVD player and then find themselves needing to justify the purchase psychologically. IMHO there's more than a bit of the 'emperor's new clothes' syndrome when higher priced digital components are discussed.
3. You will now have about $600-650 remaining. That's enough to purchase a new AV Receiver, such as the HK 525 or the Yamaha 1400, both well regarded by people on this forum. Two notes here -- 1) you can enjoy your new system before purchasing the new receiver, then bring home the receiver for a test run to see what kind of difference it makes. This way you can be sure you feel the purchase is justified. 2) I don't think the HT separates route is for you. This takes you into a new league of expense and discernment. If you want to spend that much money, you could set up a much less expensive but higher performing 2-channel audio deal just for music. But I suspect like many of us you'll be thrilled enough with this new setup to pause and enjoy for quite awhile -- years and years if you like (or atleast until you decide to add 7.1 rears to go with your new receiver).
Sum:
* QS8s
* VP150
* New sub
* Panasonic F85 DVD / CD 5-disc player
* If desired, new AV Receiver like an HK 525 or Yamaha 1400
I envy your imminent outlay.
