Is ~$800 what you want your budget to be?
In any event, as there are better choices than Sony for speakers, I suggest
these with
this center channel, or
these which are quite good speakers, and with some modifications, are
very good speakers with
this center channel. Or,
these with some
speakers stands.
Polk, JBL, Athena, BIC and Internet direct manufactures, like
Ascend ,
AV123,
Aperion, and
Axiom, also are worth looking into if you want more choices.
But even if you want to stay with the Sony speakers, I must recommend a different sub. One of the Dayton subs from
here if you're on a budget, if not,
Hsu or if size is no option, and you want a lot of extension
SVS or
Epik. Or if you're handy, it is possible to build your own subwoofer.
If you want suggestions, or more information on something, don't hesitate to ask.
Am I way over my head - should I just get one of these home theater packages?
If you want the simplicity, but a home theater in a box will
not, in any way, have the sound quality or adaptability of buying the components separately.
Is this particular setup better than one of these average 400-500 packages?
It should be, but you can do better.
Also, is it bad to mix brands of speakers like Sony and Yamaha?
It depends, as long as the front speakers (i.e. left, right, and center) are from the same manufacture and model line, the other speakers can be from anyone.