I second the Jamo S426 HCS 3 5-pack plus their SUB 210. If you live near a Fry's they stock both and will match Vann's price on the sub. I just got that exact set at Fry's for my Yamaha RX-V371 and couldn't be happier. Their manager knew I was on a budget and was actually looking for lower net prices for me!
I still can't believe the value of these speakers. They don't sound like budget speakers. They make even Dolby Digital TV broadcasts come alive with little nuances I didn't hear before with my $300 Creative Gigaworks speakers, and even those blow a lot of similar priced and above HT speaker sets away.
The actual matching sub for the S426 HCS 3 is their SUB 260, with 260 watts, but the SUB 210 with 200 watts easily mates well with them in smaller living rooms. My apt living room is roughly 11'x18' with an attached small entry way/kitchen area. Even with my living room window and bedroom door open this sub set at half volume offers plenty volume and tightness. I even have my receiver set with a max volume limiter at half volume. I never have to get anywhere near that.
Most of the small HT speaker kits have tiny 2.5"-3" midrange drivers, and there's a huge frequency gap even matching them with a 8" sub. This Jamo set with two 5+ inch front mids easily comes down to match if not slightly overlap the 8" sub. If set up properly you can get nice dynamic range and clarity, with plenty tightness to the bass. You aren't going to get quite as low frequency bass as some sets will produce, but I find if you shoot for too low a frequency on budget sets, you end up with crappy, muddy, often underpowered bass.
Honestly, Small HT speaker kits can't match these. I was primarily on my way to Video Only to listen to their open box Def Tech ProCinema 400s that retail for $600 when I stumbled upon these on a side trip to Fry's. Video Only said they could sell the Def Techs for $400, but they didn't sound worth half that to me. The sound on a lot of the small HT speaker sets sound overly digital with no warmth or depth to their smallish mids. They often have tweeters that are overly small and/or bright too.
If you like me are sick and tired of the hyped up, downsized toy-like HT budget speaker sets, whom only real selling point is the small space required to set them up, check out the Jamos. They're owned by Klipsch now, and have a 5 year warranty through them. You only need keep the receipt. The SUB 210 doesn't have an external heatsink, grounded power cord or calibrated low pass crossover (just marked 40Hz-200Hz with 4 unlabeled hash marks in between), but I have found with extended use it's metal back plate doesn't even get as warm as the top of my receiver. Use a surge protector and figure 32Hz between hash marks and you'll be fine.