Hey, DrLuck, welcome to the forum!
I'd recommend starting off with a budget surround sound receiver. While you may not want rear speakers at the moment, you might in the future. Even with just TV sports, there's more and more broadcasts done in 5.1 surround.
The receiver that I tend to recommend in your price range is the Onkyo TX-SR506. Onkyo's 500 series of receivers has gotten mostly good reviews for the past few years. Amazon.com currently has it for
$204, but they've had it as low as $180 that I've seen. It has some really nice features for that price range.
In terms of speakers, do you have any brand preferences? Have you had a chance to go out and listen to some for yourself? There are the major brands that are likely carried in one or more chain stores around where you live, and there are some good internet-direct brands. I think that you'll probably start off with just left and right front speakers with your budget, but we might be able to get a center channel in there. The center channel should give a nice improvement on dialogue.
Frys.com often has good deals on Polk speakers, and there are also some good deals out there on Infinity and other brands. I haven't bought any off of eBay, but some others here might have. I'll wait to give speaker recommendations because I suspect that others with give you links to some deals.
Adam