You should define what is meant by "smallish room". That said, I would definitely go for the Q500 setup. I have heard both and agree with my dealer when he said the Q500 just sound better overall than the Q700 or Q900. I bought my son a pair and they work fantastic in his 16' x 25' (4.87m x 7.62m) room. His sub is an SVS PB2000 though, not one of those KEF wanna-be subs. The Q400b is a good start though.
KEF R500, R200C, R100, SVS SB2000 sub, NAD T758 receiver, Pro-Ject RPM1 TT w/ Sumiko Pearl, Bluesound Vault2, Sony BDP-S480 BlueRay player, Samsung UN55JU6500F 4K LED TV, KEF M500 headphones, Sony CDP-CE500 CD changer.