I admire your drive for simplicity and aversion to geegaws. Just keep in mind that HT is essentially complex and these receivers are designed to work like Swiss Army knives with all the options one might need.
At your price point it is tough to beat the Japanese receivers - Integra, Marantz and Denon lead the field IMHO.
A couple of thoughts to help reorient:
1) any of these receivers can later be used as a preamp so you can upgrade your power amp
2) all these products offer various DSP effects (hall, reverb etc) When your unit is in HDMI mode the DSPs are defeated/by passed so you don't have to mess with them or listen to them
3) You want a unit that is HDMI1.3 compatible. You need to think through your sources since you can get from 2-4 inputs
4) The only reason to be concerned about the video processor and scaling is if you plan on having legacy sources like VHS and LaserDisc. Everything new you buy should be HDMI - its much cheaper then the old sources...
5) You need to make sure (especially if buying new) that the unit is capable of decoding the new new lossless audio formats available on BluRay discs. Stunning.
6) Whether to go 5.1 or 7.1 is largely a function of your room. Technically 5.1 refers to three front speakers, a sub and a pair of surrounds about 3/4 way back mounted on the sidewalls firing across the audience at each other. 7.1 adds a pair of speakers on the back wall (usually raised) firing across the audience back towards the screen.
7) I would not buy a unit that doesn't have the Audyssey MultiEQ technology. This is truly breakthrough stuff and makes a remarkable difference to the sound of your room. As a purist you may be inclined to scoff but I assure you this is the real deal. If you decide you hate it, you can bypass it and use the 15 band per channel EQ to roll your own.
When you get the field narrowed down a bit, I highly recommend you download the owners manuals for the candidates and spend a little time looking at how the interface is designed and how you program the unit. Very telling.
