That looks like an acoustically problematic room, which may be a contributing factor to poor dialogue intelligibility. That center speaker design is awful, and that is almost certainly a part of the problem too, and is exacerbated by the room acoustics. Its off axis response is guaranteed to be horrendous, and you will be hearing a lot of that horrendous off axis response thanks to the high acoustic reflectivity of that room. You will want a center speaker with no off axis problems.
Also, is that center speaker placed on the floor? Its hard to see from that picture. If so, try to get it off the floor, that is not a good place for it. Another thing I would think about doing is placing the rug in front of the entertainment system. You might just think about getting a nice thick shag rug and placing it there, this will help reduce acoustic reflections off of the floor. That can make a difference.
The SVS Ultra center speaker looks good for this. I would also think about getting a bookshelf speaker front stage rather than just floor standers. With a good subwoofer, floorstanding speakers do not offer much of an advantage. Here is one system that can do a lot to solve your dialogue intelligibility issues: a
KEF LS50 pair and
LS50 center. That will have none of the problems of traditional center speakers and should offer a major improvement for dialogue intelligibility. Another option that can likely get louder, but is larger, although less costly is a
Hsu CCB-8 set. That will also have good dialogue intelligibility.
You will want to replace that receiver, and I would be looking at models from Denon, Marantz, or Yamaha. I would be looking at receivers in the $1,000 range.
That subwoofer is a junker, and it is also in a bad spot. Replace it with a sub from Hsu, SVS, or Rythmik. One thing you might think about doing is getting one of SVS's cylinder subwoofers like
this guy and seeing if it will fit in the corner behind the entertainment system. The nice thing about that sub is it is relatively light and easy to move around, and it also has a small footprint and may well fit in that corner without having to move the entertainment system too much. It also has a couple of big brothers if you want something more powerful: the
PC12-Plus and
PC13-Ultra.