Yes I would definitely go with a 5.1 system since you have un-closeable openings out to other rooms. This I would say is your most significant challenge to reproducing great audio. You need to "fill" your room with sound. Your listening room should have as much upholstered furniture, drapes and carpet as possible to help deaden the liveliness of the environment. I have the same situation at home took these steps. Now as far as your budget goes, $2K may be a bit light to build a brand new 5.1 system so you may want to consider purchasing well cared for pre-owned components on Audiogon. Make sure the seller has a high rating. How about this: a 5.1 AVR (i.e. Marantz, Yamaha, Onkyo, Denon, NAD. etc), pair of decent bookshelf loudspeakers (i.e. B&W, Monitor Audio, PSB, Boston Acoustics, etc), CD player (Marantz, NAD, Sony, Denon, etc), pair of surround satellite speakers, powered sub-woofer and cable. If you browse deep enough in the Audiogon equipment for sale link, I'm sure you'll find a great combination of pre-owned equipment. I would purchase preowned over brand new mass market components. Just my opinion.