Even though you don't need a really high wattage sound system for that area, you might want to look at a decent reciever anyways, simply because they act better as device hubs than TV's do. You should be able to find a decent reciever in the $200 range locally. I tend to prefer Yamaha recievers since thats what I am familiar with, but really, most of the decent ones with multiple HDMI ports should do the trick: http://www.newegg.com/Product/Product.aspx?Item=N82E16882115239
such as this one for example.
Once you have a good reciever, you can start buying speakers piecemeil. If you are handy and own the place, you can install wall mounted ones dirt cheap if you look for deals on overstock wall mount speakers, or even used ones, which can be problematic sometimes, but also often dirt cheap: http://cgi.ebay.com/Moderno-Sonance-in-wall-speakers-3-M6-3-M6R-1-M10-/190533950908?pt=Speakers_Subwoofers&hash=item2c5cb55dbc
If wall holes aren't your thing, then start small with a pair of front stereo speakers, and then add the additional speakers as you go. Your reciever can be set to 2.1 surround mode, which is 2 speakers and a subwoofer. Get a good subwoofer if you enjoy music or movies. If not, don't worry about a good one. A good reciever and a good subwoofer really compensate well for medeocre speakers.
Check craigslist too. people are always moving, and the larger, bulkier speakers are often available in newish condition for very low cost since they take up so much space.
Stay away from the cheap " all in one" speaker + reciever kits. they usually have sh*tty recievers and sh*tty speakers.
Anyways, once you have a good reciever, you plug all your devices into it, then get a universal programmable remote like one of the logitech harmony remotes, and then you can literally press 1 button to turn your entire system on to the correct input for whatever device you are trying to use.
edit: My setup. Edited, May 16th 2011 9:15pm by Kaolian