Brother, can you spare some time for HT advice?

Hi. I've been a two-channel guy for years but am exploring an HT setup and could use some help. I'm thinking about a Samsung LCD TV (LNT 4671 or 5271), a Panasonic dmp-BD30 Blu-ray player and either an Onkyo TX-SR705 or the Denon AVR-988 receiver. I've also heard good things about the KEF KHT3005 surround speakers. Ideally, the receiver would have multi-room functionality so we could run a pair of speakers to an adjoining patio.

The gear would be placed in a 15x18 foot family room that's open to a kitchen about the same size, with hardwood flooring throughout. (I know, not an ideal configuration, but it's where we spend most of our time). We're about to start a remodel of both rooms that will allow us to hide cables and keep things nice and neat, but will also leave us running lean for a long while, so we're looking for gear with the most bang for the buck. Any opinions of the equipment I'm considering, or suggestions on better choices?

I have a very similar set up. I have the Samsung 4661, Panny BD30 and Onkyo 805 (see my HT system). I'm very happy with the set up. I'm not familiar with the Denon you reference, but if you go that route, make sure it will decode advanced audio since the Panny will not decode internally. The Onkyo 705 will work great.
My brother just bought a 705, polk soundbar, oppo 980, and a smaller hsu sub and loves it. He wanted to downsize the whole previous setup to just a couple pieces. He loves it. You may want the 805 due to open floor plan/power needs. This will depend on how loud you listen to it as well. For the money(amzon)the 705 is a great deal overall.
My new HT set up: Onkyo 805/NHT m5/ NHT U2 sub/Better Cables Silver Serpent speaker cables & coaxial digital= sweeet. In my set-up, dialogue cannot get any better with the NHT M5 speaker.
One piece televisions aren't big enough to provide a cinematic sense of impact beyond the shortest seating distances, especially when you limit yourself to flat screens priced less than nice german cars.

A 50" plasma is good out to 5-6' or 65" out to 6-7'. Once you get out to 10-11' you really want a 100" screen once you get used to thinking in terms of small movie screens (at 11', 100" diagonal gets you the subtended field of vision you'd have in the last row of a decent THX theater) instead of big TVs.

You really want to use front projection with some light control and a grey screen. If you must watch with high ambient light you can hide a flat panel for casual TV viewing behind a retractable screen for movies.
I tell you what - since I've sold those products over the years, I can say that you should act on the seeds you have planted with thos product selections! Otherwise, you'll never know if you thoughts were right. And, I think the product range you are looking at is likely going to do very well for you for movies, and pretty nice for many music sources, as well, personallly.
If it were my choice, I'd be looking at the Kef's (run them as "small/80hz") and the Denon. I think that combo will not do you wrong! Good sound overall.
Good luck
I'm especially intrigued by the KEF's. The company seems to pay attention to build and sound quality and the reviews are pretty glowing all around. (Plus, my wife actually liked the way they look, which is rare). I also was leaning toward the Denon receiver. Onkyo seems to offer more features for the money, but the setup and operation seem pretty daunting for a newbie and some reviews indicate that they run pretty hot.
For an HT set up I'd recommend plasma technology over LCD.
I'd go with the Kef's you like, and the best newer Denon your budget can allow! Sound will improve with better electronics. Otherwise, an even better sounding option, would be to buy a Denon with the HD-DD and DTS Master, Audyssey, and pre-out's, and then to run an outboard amp! Otherwise, go with as much receiver you can.
Good luck. I think you'll like the combo.
No matter what they say, the Denon will be stronger, smoother, and more full bodied for relative price ranges.