Wow! I wish I'd seen this sooner! You may want to try the sony STR-DH100. It's a 90 watt per chan stereo receiver with decent sound. Sony also makes decent shelf and floor speakers. My concern is that you may not be satisfied with a <$500 system. You may want to buy a receiver like the Denon DRA-397 or similar Harmon Kardon and get speakers later. You don't have to buy it all at once. Go cheap on the iPod dock, get a Dynex for about $60, then upgrade the cable using Rockfish.