ok, Let me see if i understand. You are suggesting that i connect the blu ray to the TV via AV cables. This will play blu ray discs and i will not be able to tell the difference between an hdmi connecton and the av connection.
Yes, this should be the case.
However, the av connection will not up convert my current VAST dvd collection to any degree. Therefore, i would only be using my blu ray player to play blu ray discs but i would not get any of the extras that the hdmi connection would provide. Is this correct?:
This is correct, but as stated above, your TV already does some conversion and this capability may not matter if no upconverting DVD player is compatible with your current display.
If so, then the blu ray player is an expense not worth the effort unless i want to pay the $275 to upgrade the TV.
Blu-ray is the future and at some point you likely WILL be buying exclusively on DVD and only renting HD movies from this point forward. As such, Blu-ray really makes a lot of sense. (see my notes below)
Then i would be in close to $500.
(275 repair, 160 for sony blu ray player and 50 for an hdmi cable abd optical cable to run through my bose home theater system.
As said above, don't you dare overpay for your cables. You already may hear about buying Bose. There's no reason to overpay for good quality gear.
What bugs me in this is that HDMI is backwards compatible and you should not be running into HDMI issues. While a bad HDMI cable could cause you headache, it doesn't make a lot of sense that you are running into backwards compatibility issues based upon this answer from HDMI:
http://www.hdmi.org/learningcenter/faq.aspx#13
I would SERIOUSLY get a different Blu-ray player and try it out with your display. Perhaps try a Pioneer or Panasonic Blu-ray player instead of what you are currently using. Panasonic tends to have very good compatibility and Pioneer to Pioneer might provide better results as well.
Other things I've read indicate the same...
http://forums.cnet.com/5208-7596_102-0.html?threadID=273946
http://8851651122276554420-a-1802744773732722657-s-sites.googlegroups.com/site/columbiaisav/hdmi_versions.htm?attachauth=ANoY7cpJzCMGmYhSRkY1Zw0xwZqI0w796G_7CBn04eNucLxDqaI6xZsB1JzSqFsOFZrq7N24IQaV7qa7RxDuJeZa4E_m4bFTGCdgc6v54u2fIkKb9slfPwoE9unBSbrZUUWQJwNtNa4yYJIJBcHgA6A-Q5SZhk2-5dxXbyCU4_hP6Jy_vDjAis6HDhQ72mQqsO0ND6TruKk4xE7T8PMZn-getP3xk5iK4Q==&attredirects=0
Worth a read...
http://en.wikipedia.org/wiki/HDMI#Version_1.0_to_1.2
I think you really need to keep your $500 and instead try a couple of different players and make sure that you are using 'lower' settings on the Blu-ray player which could make it incompatible with your current display. For example, do not use deep color (see Wikipedia link) as that is probably not compatible with your display.
A bit of a headache, but for $300+ in savings, worth it if it works.