Unfortunately, the advice that you were given bfore, is not uncommon.
Quick example....
I had a customer last month who had used an Insignia $100 stereo receiver from Best Buy to power two zones of in-ceilings downstairs in his basement. He called me wanting to have someone come out and check to see if his wiring was done right because the sound was very muffled and lifeless. I happened to have an NAD T744 receiver on the truck and brought it in for him to A/B. Huge difference. Absolute night and day. Since the NAD was surround sound and he had Harman Kardon equipment in an open rack we ordered him an HK stereo receiver which did just as good as the NAD, but for a few hundered less. Going with a good receiver will pay off for you.
Onkyo makes two stereo models. TX-8522 ($300) and the TX-8222 ($200). The 8522, I think is the better product. Long term, what's a hundred bucks? No, you won't need the video switching in the 8522, but in my experience with both products, the 8522 sounds stronger even though the difference is only 30WPC. Since you are running this into 3 different volume controls, I think there will be a difference. Besides that, the 8522 has I-pod options as well as XM if that would matter to you.