Sounds like the perfect contender for something like the samsung HTiB bluray system. Yeah, wires for speakers, unless you get those wireless adapters from rocketfish or something, but a soundbar is going to easily eat 1/2 your budget leaving nothing for a display or other components. The samsung bluray might be overkill though, she just might be okay with something like the upconvert samsung or sony HTIB. For the budget, and distance, i'd recommend one of the middle-of-the road HTIBs and a decent 37-42" LCD. Get it all from best buy, with warranty, and due to the distance thing, pay geek squad to hook it all up. With only 2 devices, the harmony might be overkill as well, a simple universal would do it. I know i tried to teach my mom how a harmony worked, and gave up shortly thereafter when she got frustrated and started pressing buttons on the equipment, thus negating the reason for the harmony.
Go check out the HTiB forum and the LCD forum for bang-for-the-buck models. Personally, the HTiB systems i've ever seen, panasonic and samsung seem to be the better ones, not sure about the quality of LG. And for displays, think Best Buy still has the insignia 47" 1080p LCD for under 1k.
Heck of a setup for 1500 really, especially for mom-in-law
Or the 37" sets are getting down there in price, $600-800 depending on brand.
But definately pay an installer to hook it all up. Also, decide what equipment, then order cables from monoprice, send them to mom, and when the installer comes out, she can just hand him a box of cables instead of her getting bent over for "oh, you need this $100 cable too!". Be the hero.