Looking to upgrade

I agree with Teslaroadsters, changing your speakers will make the biggest difference. Try to match them all, or at least the same series (where usually the only difference is the size of the woofers).

Bob, if I upgrade to Evolution 5 or 6 do my NHT VT-3 still work okay as surrounds or do those need to be upgraded as well? Thanks

The KEF 105 are great speakers. They are much more musical than NHT. I used to own a pair for a short period in 1980. Don't change them if they are in good shape. But I would suggest you find someone to rebuild the crossovers. After so many years, the capacitors must have been deteriorated and that will change the crossover point and degrade performance. Without a properly working crossover, you have no idea how good they can be.

I disagree with the above. Your speakers are fine for now, and if you try to upgrade them it may take up your entire budget.

But if you insist on upgrading speakers, be aware that in a home theater system the speakers used should all come from the same manufacturer and line. Ideally, except for the center channel, they should all be the exact same model and make of speaker (front and surround) to give a more realistic experience. Still you can ignore this last part so long as they are from the same manufacturer and same line.

But I still say go with electronics first. I hold to my recommendation of an Arcam AVR 350 (used) given your price constraints. If you want to try separates, I second the vote for a Linn AV 5125 for your amplification - it is awesome for the price. This runs around $1400 used.

For a good price on a line conditioner (I hope the link works):

http://www.audioadvisor.com/prodinfo.asp?number=FUEL15DM

At this price, you will be making a very cost effective upgrade to your system, at least if you buy a Furman. I have to confess outside of the Furman lines, I have yet to find a line conditioner that I would put in my system.