I am only so knowledgable on the subject but would agree with the post regarding avsforum. It is very attuned to this sort of thing. One option is a home theater pc which would do what a dvd and scaler do, but it has its downsides (technical expertise is needed). I went with the centerstage focus 1 and am very happy, it was on the advice of the videophiles in my audio group. It lists for more than you like but I do know a chap where you can get it well within the range you wish to spend. If you want the name drop me a note
Gary
Gary