Just to chime in with some alternative views.
I have owned systems that had total components with a cost approaching 30k, and trust me, this was not near what other audiophiles were spending even in the late 1970's, early 1980's. System consisted of respected tube pre-amp and four mono-block tube amps powering various bi-amped (not bi-wired) speakers or on occassion strapped for single channel per side. Turntable cost more than my current system. Add tone-arm, various moving coil cartridges and assoicated pre-pre-amps. And finally well respected, but not insanely priced speakers where I could not hear the minute differences that some golden ears professed to hear. Throw in a pair of reasonably expensive (and unreasonably heavy) 12" sub-woofers and the solid state stereo amp to control the monsters. Some people would have called this state of art (my wife called in state of insanity). Sonically, there was little in the way to criticize.
All of this was before CD, so you can tell, I am no spring chicken. The sound was reasonably accurate for the time. Most people hearing a system like this for the first time were stunned.
My current 2-channel system used for music would retail for less than 3k and has sound, at all but unreasonable sound levels would match or better the earlier system. Receiver that sells for under 1k (way under), pair of speakers with better frequency response than my old expensive speakers. Good dynamics, but not quite as good as the old system (this item tends to bring about more realistic sound to my ears than almost any other). No turntable. DVD player with digital output for CD's and digital music. Powered sub-woofer. Less than 1k. Not cheap, but not insane either. Again, much better sound than most people have been exposed to.
I have been looking for more than two years for replacement main speakers (my current 46" towers make good plant stands but otherwise interfere with my lovely wife's decorating scheme). I have tried a number of very expensive smaller speakers, but all lft too much to be desired to change.
Our video is in a different room and has had various multi-channel receivers and multi-channel speakers. None were able to make me happy, including at least two highly rated multi-channel pre-amps with all of the digital bells and whistles to make multi-channel sound come alive.
While I do not possess golden ears, I have yet to hear a pre-amp or receiver at any price that I could not detect the sound processing for multi-channel sound. I can pretty much pick the processing out in double-blind testing 8 or 9 times out of 10 (from actual tests in a local audio salon).
After almost 20 years of attemptig to get multi-channel right, I decided in 2007 to try a sound bar. At the time, Yamaha was the only game in town and I purchased a model near the top including Yamaha's dedicated sub-woofer. After three weeks of playing with projector beams and attempting to get the sound right, I switched to 3.1 sound and lived happily with the Yamaha for two years. Both my wife, son and daughter-in-law could hear the Yamaha sound processing when it was turned on, so it was a no brainer to leave it off.
In 2009, read a short review of Sony's CT-100 and it sounded promising enough, I decided to give it a try. Surprise, to everyone it surpassed the Yamaha and sounded quite good on almost all program material. After about six months, I saw a Vizio soundbar at Wal-Mart for less than $100. For curiousity, I wanted to see what $100 sound could sound like. While not as accurate as either the Yamaha or Sony, Vizio beat both hands down in dynamics. Became my sound of choice for TV and Video for over a year and still handles TV and music in the master bed room.
Stubled upon Davyo's review of the JVC BA1 and ordered one from Amazon. Since it's arrival, it has been consistently in my system and does offer extremely good five channel sound from four speakers without audible sound processing. Let me say I have been impressed and still am.
Way too much info here. But, the question was, can you achieve good sound for very little money? The answer is yes and I enjoy helping friends and family find the right fit for their lifestyle (I almost wrote needs, but don't believe anyone needs good sound, it just makes life more pleasant).
The JVC is a mediocre choice for stand-alone music (we have tried to my wife's dismay - she really wants me to find a new home for my tower speakers). But for everything else, it equals several surround systems that cost more than 2k that have ventured through my home.
As the earlier poster said, there is a law of diminishing returns when it comes to audio. In many ways the state of the art is better than it has ever been. However, the amount of the state of the art that has filtered down to popularly priced listening is a wonderful thing.
The biggest problem I see now, which is what I saw in 1973 when I started my journey into audio idiocy, is how easy it is to get reasonably good equipment with the potential to sound good, but somehow end users and many good hi-fi stores still set up equipment to sound like electronic sound instead of setting things up to sound natrual (it is not that hard).
Test things in your home wenever possible. Pay more attention to speakers than electronics. At reasonable sound levels, most electronics sound pretty much the same (boy am I going to get ripped for that remark). When you find something that sounds like music, sit back and enjoy. It certainly beats that morning after feeling when you spend 20,000 dollars on a pre-amp and no one is sure it sounded different from the 200 dollar receiver it replaced.
ps... if you don't listen to records, you don't need a pre-amp.