here's my modest setup:
-Sony Bravia KDL-40VE5 40" LCD
-Teac MCD-90 (old CD player/receiver I got a looong time ago. came with nice bookshelf speakers and sounds pretty decent. the CD player portion no longer works at all and the subwoofer channel doesn't either if I recall but it's oodles better than TV speakers)
-the white laptop cooler holds my wife's macbook pro when we watch stuff off it, gives a much better image quality than the xbox IMHO. sometimes the macbook doesn't recognize our TV as an input though which is kinda annoying, might be something to do with the thunderbolt-DVI-HDMI conversion.
hopefully I'll run a bunch more cords to it from my computer, at least sound to get rid of the headphone extension cable running across the floor right now...
the shelf is a little high for the speakers and the TV could move up a couple inches too but overall it's ok.
TV stand is a ~$10 ikea lack table with a couple painted black 1/4" plywood shelves I whipped up.
Here's our seating, loveseat and futon: