Where do you start? Is there any hope?

separates?...highly highly unlikely...i would break 500 down into 250 for speakers (used) 150 for an integrated amp (also used) and 99 bucks for any new name brand dvd player with a bit of a warranty. with the last dollar...buy a lottery ticket because you'll need at least 30 bucks more for all the cables...and that is on the CHEAP....and hey...you might strike it big with the lottery and get those seperates...start shopping the classifieds here.

I have a older set of speakers and some wire and rca they are not top of the line, but I think they are nice for now. The cables are cast offs from friends. Mostly monster, AR, RCA gold, and audioquest.

How about this approach? Try to find an old Denon CD player or something similar with a variable volume output, so you can attenuate the volume without a preamp. You can probably pick up something decent sounding for pretty cheap. Then look for an old adcom power amp, like one of the old GFA 535's. They were only $300 new, so if you can find one, that shouldn't set you back too much. Nextyou might consider some small used monitors like the new Epos 3's, that later on you could rotate into a home theater set up, at least for back channel speakers. I could see how you might put this together for $500-$600. It would get you into the separates manifold, give you sound you could live with for a while, and let you upgrade as you have the cash. Later on you could add something like a McCormack TLC-1 preamp, a newer CD player, etc. Most set ups don't need gain from the pre amp to deliver more than adequate volume, especially with reasonably efficient speakers.
Back in the late 80's, I ran a Denon 1520 CD player through its variable output into an Adcom GFA 535 to some ADS speakers. It was a pretty decent sounding bare bones $1500 system. Go Bucks!

Brownsfan........Jeeeeeees
Fot a newbie thats pretty darn smart there!

this is it....
onix A-60 int. amp. loads of power for HT dynamics, and the bass..., clean detailed sound with great imaging for music. used consistently $150 .
sound dynamics rts-3's, nuff said, used consistently $150. might be tuff to find though.
toshiba 3960 or 4960, look on ebay, pay no more than 70 bucks(and that might be alot)for a new one. they're there.
lastly,with the $150 or so left over, goto audioadvisor.com get some stands and maybe a closeout rack, then email paul speltz and get some cables. you now have a system that will rock and refine, i promise cuz i had it...