Advice on surround sound system?

I have a decent CRT projector setup, but my audio setup is, shall we say, lacking.

Currently I have (try not to laugh), an ancient Trio amp, a portable CD player and a pair of Mordaunt-Short MS10s. Music hasnt exactly been a big priority of mine.

You can see my room layout at http://www.bofh.ly/lounge2.jpg

There's a fair bit of space at the back of the room for speakers, at the front there's say 1.5-2ft between the floor and bottom of the screen.

I can see there are a number of possible technologies available, but it's not immediately obvious how well they'll fit in my room - for instance I imagine sticking in a 7.1 system might be over the top..

I suspect that although AV amps offer inferior performance to a dedicated audio amp, whatever I put in will surpass my existing audio amp. Surround sound will be provided via SPDIF from a suitable soundcard in my HTPC, I'll have some sort of CD player linked up and possibly a rarely used tape deck.

I eventually want to have sound in other rooms, such as the kitchen, as well as the lounge.

Let's say I have a budget of 600-650 quid for arguments sake.
I'm not looking for the ultimate in audiophile quality, but I do want something good. I would rather upgrade the system piecemeal, rather than get something low end and have to continually chuck away kit. Can I get a decent system for that price - I imagine starting with a 5.1 system is a good idea.

I dont have any speaker stands (they're currently on cardboard boxes) and probably need better cabling too. Any advice on routing cable round the room would be appreciated - trunking?

Advice and pointers will be gratefully received.

PK