New sound system, $5000 max- what a would you do?

Based on an average size listening room...Source:ANY decent quality DVD Player from Yamaha/Marantz/Denon etc..with a Toslink Out $200.00...Integrated Amplifier:Peachtree Audio Decco 65SE $800.00...Speakers:Harbeth Compact 7ES $3000.00...Headphones $500.00...Stands & Cables$500.00....

Depends on what kind of music he's into for speakers.  But for the rest, I would go for one brand like Cambridge or Marantz so the guy has tone controls.  Budding audiophiles need to add some bass here and there.  Plus, he can use one remote for the amp and cd.  For speakers, assuming he's partial to pop music, I'd go with maybe a Wharfedale tower or maybe one of the Axiom speakers.  It's pretty far from high-end, but it's better than most people are used to.  I set a friend up with a system like this and it's quite listenable.  Oh, forgot the cables.  Probably just some Blue Jeans Belden and maybe a $150 Audioquest IC.  I would also recommend a Wiremold power strip with a few Volex PCs, just to have something half decent.  

I second the volex  power cords

I read I remember when the Wiremold strips were $40! 

Zavato,

Are those the power cords that retail for 7.00 and sold thru electronic parts online?