On the audio side this would be an excellent way to go. In your room the VP-160, and the QS8's would be long term keepers. I also agree go with the full box speaker on the M22's. Use them now for your L/R speakers, later on if you wish to upgrade, and are able to try them possibly as L/R wide speakers, or simply move them to another room. The EP-350 is a good start for sure, maybe later on you might think about swapping it out for something a little bit bigger with lower extension. The AVR seem more than adequate for starters, later on you could always look for a unit with more bells & whistles if you had a mind too.

On the video side for the money in your budget these are fine options.But be aware of a couple of things though. One the Epson 3010 is a LCD projector. Their technology has come a long ways in the past few years, but is still somewhat susceptible to motion blur. This is most notable in watching sports programming NASCAR, Tennis, Golf, etc.

On the projection screen I know most people would believe that $500 is a lot of money and that they would be purchasing a good quality screen. That's just not the case. This would be an entry level screen made of a mat white material producing a great deal of light scatter throughout the room. Unless one would have a great deal of light control during the day time hours, the picture on the screen will appear washed-out making viewing not very appealing. At a 100" a very good quality screen would go for 4-5 times what you're budgeting for now.

I would say you might want to consider a higher contrast screen which will enhance the blacks and shadow effects of the projected picture. This is sometimes known as a grey screen. It will cost a little more than $500 but won't approach the 4-5 times higher for the top notch screens.

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