Sound System Help, Recommendations Please

So I have a decent little theater setup...except for my sound system. I have this Sony Mini Hi-Fi system that's intended as a room stereo that's just not doing the job and doesn't balance sound right...so I figured now's a good time to get a decent stereo receiver and speakers. I need recommendations.

I'm not looking to get too fancy. I'm fine with just stereo and center with a decent sub, no more than a few hundred dollars for all of it. I have a PS3, Xbox 360 and (less importantly) a crappy Comcast cable box to plug in, with possibility of future stuff. I heard the GB crew used to recommend Onkyo but they started going bad on them...

Anyway I'm looking for quality but not necessarily top-grade audiophile stuff. Any suggestions and recommendations on how to set them up to get the right channels working (spoken audio is sometimes way softer than ambient noise, etc.) would be much appreciated. Optical digital would be a plus for sure.

@MormonWarrior: There was a Denon thread comparing receivers on the AVS forum. I remember reading through this one: http://www.avsforum.com/t/1334369/the-official-denon-avr-xx12-model-owners-thread and here's the newer model thread: http://www.avsforum.com/t/1409431/the-official-denon-avr-xx13-model-owners-thread-faq. I've heard good things about them and will probably get one of theirs in the future. You could probably poke around there for advice threads. I ended replacing an Onkyo receiver with a Samsung one. The promise of hdmi control with my bluray player and tv sounded awesome. Unfortunately, the way their software is set, whenever I'd turn off the bluray player, the tv input would switch to TV, or the antenna connection. Not very good when I'm running an HD cable box. I ended up getting a Harmony remote to manage everything and swearing off Samsung's products. Pretty crummy software, but the hardware's nice.

I didn't have problems with my Onkyo, but that was also an older receiver without hdmi, which I think was the problem people were having.