Hey Lost World
Welcome to the forum Buddy...!!!
Have a nice stay here...!!!
Now, i think you are very clear with Venky's (vankatcr) first post in your thread, of what exactly the systems are...
In Short the 5.1/7.1 is actually the Home Theatre what everyone calls as, and the Stereo Setup what is there for pure music lovers...
Now, as you said in your posts, that you are looking at something keen into music, and DVD's/Movies, will come occasionally...then buddy you should not be looking at the 5.1 Setup...
Ya, you may be thinking the better the number of speakers the better the sound be, but for that you need to do some study, and please search some posts/threads in this forum, that states that, as if i write it out here that will be too long, and instead same, what has already been mentioned by the Gurus out here...
Anyways, Mordaunt Short - Mezzo Series, is one good among what you should go in for, with the decent Integrated Amplifier, from Cambridge Audio, supplied by the same Fx-Entertainment or Rhythm Corner, where ever you have auditioned MS-Mezzo, but i think Rhythm Corner dont have Mezzo out there in there showroom...
Anyways, now, regarding the LCD...again there will be a fight out here if you say you gonna get LCD and that too 37"...
Bro, just two point to finish this LCD - Plasma War...
1). Buy LCD, only if you are buying 32" or Lower, or If you are purchasing a flat panel for Data Use only...
2). If your viewing distance is less than 10-11 feets...if its below 10 feets, than go in for 37 or 32...but if its 10 feet as well than dont think anything else than a 42" Plasma...
Now, if you want more specifications, on LCD & Plasma, then please visit 'N' number of threads/posts out on this website..
Now, the few most important points...:
1). Cables - They are the nerves of the System, any quality neglegence will bitter your listening experience..
My preference would be :
a). Usher - 16 Gauge - Rs.180 per mtr... (Good One)
b). QED - Silver Gauge - Rs.150 per mtr...
c). Monster - S-16 - Rs.150 per mtr...
The reference is not because i sell them, but as they are really good...
2). Interconnects - Dont use any interconnects in your system until n unless, you need to remove the cables daily from your speakers...
Remember, any joints in between the signals, create signal loss...So avoid them...
Now, one more thing, as you have a good budget, then dont intend to spend all of it, as its been suggested by your sales person...
Please go through its utility...And for your room size, you basically dont require that big setup...
Instead get a Full HD Plasma...
Sorry, forgot to mention, Please get a good CDP not DVD for music...
The terms are well being explained by Venkat...
Go in for Cambridge Audio or ......
So start auditioning all and Best of luck for your system...