[DW SD]

I bought two harman Kardon digital receivers within your budget. They have plenty of power and the sound quality is excellent. I use the second to power speakers in a separate room, which would accomplish what you want, I think.

They feature a toslink digital output monitor (it is optical that you see on the back of DVD players and CD players). I use the output of one and the input of another to tie them together, so they are in sych and drive music to both rooms. The AVR 110 and 130 are the ones I have and were about $250 ea. I use a powered sub in my TV room. Each drives 5 speakers with your choice of various surround sound configurations. They also accept other digital inputs (spdif). I use spdif to play MP3s, but this allows the digital to analog conversion to take place in the amplifiers rather than in the PC. It is cleaner this way.

Mine are old (2 to 3 years). If you check out harman kardon's website, you can actually buy the surplus products very cheap. I bought them from Fry's, but later found I could have bought them even cheaper.

Doug