$3000 Speaker/electronics budget

I disagree pretty strongly with some of the posts above.

First of all, a quality DVD source SHOULD be part of your friend's budget, whether it is now or not.. He really needs to go see the difference a good DVD player makes by auditioning at least one and comparing it to whatever he is using now (presuming a standard mass market player). It will make far more difference than your friend can begin to suspect.

As for fund allocation, I would do it as follows:

Arcam DVD 78 - around $600 used when you can find them (1 k new). Absolutely nothing comes close for video and audio quality anywhere near this price range.

Arcam AVR 250 receiver - $800 used.

Then spend the rest of the money on speakers - either Paradigm monitor series or Rega's new R series. With these speaker lines, $1600 goes a long way, even buying new (which I think I would do for simplicity’s sake).

At this price point I would avoid getting a separate amp and processor. I think separates make sense only if he were to go up substantially in his price range.

"Does he walk around the room/home listening to background music a lot. Or does he like to sit "anchored" in his only chair in his listening room, and listens always by himself...or does he have a wide seating arrangement???
These ALL MAKE A DIFFERENCE in gear choices! There's not "recommend for a budget" More info please!!!! Otherwise, I'll recommend Bose and be done with you."

A fair point, but a bit overstated given the price constraints. If the friend has a huge room I really can't think of anything reasonable that can be done in this price range. In a smallish to midsized room, my recommendations more or less stay the same. I would simply buy different speakers within the product ranges I recommended. As to how any speakers are going to sound in a *specific* room, based on my experiences with home auditions, I think it is a bit reckless to make many pronouncements other than the most obvious related to size. The friend needs to hear the speakers at home in the room in question before buying. That is one of the reasons I would bite the bullet and buy the speakers new.