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Originally Posted by replicant_argent
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AVS is the best place to get AV advice. You will probably get much more bang for your buck with new speakers than a new receiver, but then you don't get HDMI inputs... Some options:
1. Buy a nice receiver that has the features you want. Onkyo, Denon, Yamaha, Pioneer all have pretty decent offerings in your price range. In addition to HDMI, you may gain some cool features like internet radio, network streaming from your PC, Pandora, etc. Then you can upgrade your speakers when you have a little more cash. Excellent speaker deals pop up on craigslist if you are patient...
2. Spend your money on speakers. This is where you will get the greatest improvement in sound quality. Then get an inexpensive HDMI switch from monoprice. You run the HDMI video to your display through the switch and audio to the receiver via optical or coax. This is what I did for a couple years before upgrading my AVR. Actually, I'm sure I still have that switch in a drawer somewhere and you are welcome to it if you decide to go that direction.