You should be able to put together a component system for under $800. My setup is very piece-meal, but it sounds good to me. I have:

• Sony STR-DE945 Receiver ($350 from Sears with price match). Will be replaced by JVC RX-8010V ($285 from AMDV.com)
• JVC XV-F80 Progressive Scan 7-Disc DVD/CD Changer ($280 from Sears with price match)
• Acoustic Research HC2 5 channel + powered sub speaker set ($430 from J&R Music World)
  

OK, it's about a grand. But, you can choose different/cheaper speakers. No matter what you do it should sound better than a mini-system. And it won't look like a slot machine/blinky disco light show. If you need a tape deck, pick one up at a garage sale... I did ($20). I keep it in the closet though. I only needed to use it once in 4 years.

You might also choose a 5 disc CD player instead of a DVD/CD changer. That substitute alone would save about $150. I only did it because I needed to upgrade my DVD player and figured I would kill two birds with one stone. Previously I was using a 5 CD/LaserDisc player for CDs.