Well, Sony has fallen out of sorts in general with almost all of their audio gear. Their receivers are poorly engineered and don't offer the value for the money that their competitors do.
The Pioneer 815TX gives you a full 7.1 system with automatic setup at a very reasonable price.
Understand first and foremost, you have a VERY entry level budget. Bottom of the line stuff. Barely reaching beyond home theater in a box setups (HTIB) so making a list of 'this is what it must have's is not going to work. You will get a list of 'this is what you might be able to afford... maybe's instead.
So, no, Sony tends to make poor speakers, their receivers are over-priced and under-engineered for the money. You have better options for both. But, I would try to keep the sub if you can.
Many people don't have a single speaker that costs LESS than $700 for comparison for what you are asking.
But, without sacrificing a lot of quality - you can pick up 4 Aperion 422 L/Rs for $400 and add a Aperion 422 Center for $120.00
That's $520
Add the Pioneer 815K here:
http://brandnamez.com/merchant.ihtml?pid=20960&lastcatid=88&step=4&AffNo=492452167
For $255
That's $775 - Yep, still can't reach the perfect budget, but at least the sound would be decent.
There's always Audiogon and eBay both of which can give you some deals.