Yeah, that's what I recommended. It's not going to get "super loud", but it should sound decent. That's only $100 per speaker ($200 - $300 each would be much better). People spend thousands of dollars on each speaker to get great sound, without getting "super loud".
Money on decent speakers is always worth it, and you'll be glad you don't cheap out on them. With the panisonic rig above you'll be wanting to replace it in less than a year. Good speakers and amps last a lifetime. Digital gear like dvd players are obsolete in less than 5 years.
Focus your money on the best speaker you can afford, $100 ea (x5) is barely entry level and you'll really have to hunt to find something decent at that low of a price, but it can be done. Your looking for smallish (6.5" 2 way) basic speakers from a known company like Polk, BA , JBL or Infinity. They won't get "super loud" but they should sound decent and last a long time.
You can add a budget sub later. Assemble your own from parts at Parts express to get more "bang" for your buck. A plate amp, a 12"-15" budget sub (like the quatro) and build your own box.
I have five $125 polk 6.5" 2 way bookshelf speakers, and two 12" quatro subs, with two 250 watt plate amps and my system sounds much better than anything else I've heard for these crappy "systems", costing three times the price of mine, from any of these big box stores.