HTIB for a great solution.
Thanks AV. I thought that the DC-10 would do the sufficiently do the converting but the Best Buy rube said otherwise. As for the sub, the space is an open living room, kitchen, dining room configuration, so not ideal for the "theatre" experience. Just looking for something ($~100 and small foot print) to provide some bass to balance out the book shelves. Or do you think a center speaker is more important at this point? Again, thanks!
Jon
Hi Jon, Welcome to Audioholics.
I thought that someone would have give you some help by now, but they're probably busy at more important matters, I guess.
Anyway, I'm here now. Sorry for the delay, I'm quite busy for my preparation to the Himalayas. That's right, I'm a climber.
The Panny G10 is a great TV. So it's a good one to do 1080p. No problem here.
But for more info, go to the TV displays in the appropriate forums, you know...
Ditto for a subwoofer, and speakers. NHT make some nice speakers by the way. And for a sub around $100; cannot help you here buddy, you'll have probably to look for a used one.
Now, for the piece of resistance, the hub, the hummer, the assistant chief (after the speakers of course, which is the main chief, or the main meal).
OK, you look at the Pioneer ones. About the VSX-919AH-K, right between the 1019 and the 819 receivers? It surely will do with some bookshelf speakers.
Even the VSX-819AH-K will do the trick. Very affordable, lots of features, enough power for your needs, and fine sound with pass-through HDMI video.
Plus of course the latest high resolution audio codecs.
I first mentioned the 919, because a lot of people seem very happy with that model, so that's why it's #1 from my list of Pioneer receivers in that price range. Plus you can get it very cheap at discount price. Won't have to rob the bank for it, that's for sure.
The center speaker is as much important as any other speaker, including the sub. I suggest that you go for a full 5.1 speaker system package. Maybe even one that includes the receiver.
About the full enchilada for less than $999 USA? Is that sounds fair enough?
All right, let me do my tricks and I'll be back in no time with some link(s), just for you my friend. I promess that you won't be disappointed either.

...
... *** I'm back with three HTIB. Don't forget though that these three systems can be had for less than their suggested retail prices, roughly 30% less, street prices (perhaps even less with careful shopping).
1. @
http://www.hometheatermag.com/hometheaterinabox/yamaha_yht-591_htib/
2. @
http://www.hometheatermag.com/hometheaterinabox/1008panahtib/ ~
3. @
http://www.hometheatermag.com/hometheaterinabox/onkyo_ht-s9100thx_integrated_system/ *
* -> Sans the Sub.
Which one you think I like most?
~ Hint: I always aim for the middle.

Same as in the Pioneer receivers.
So, here you go, some very nice options for you here my friend.
Hope that helps.
Cheers,
Bob