In which case, I'd personally go with a separates system - you'll get more for your money and, if desired, you can upgrade components in the future without having to replace the whole system.
I'm going to assume your PS3 will serve as Blu-ray player? In which case, AV amp wise, the
Sony STR DHR820 is a good bet - it's got everything you could need at the moment and for any future requirements (including support for 3D if you ever go in that direction). It can also be picked up from Richer Sounds for £250 - bargain!
Speaker wise, there are a few options. If you can convince your other half on bigger speakers, I'd look into maybe the
Teufel Theatre 80 system which is currently £350 from their website (
link). The upside is, for the money, this looks like a tremendous package, and you get a 12 week trial, so you can send them back if you're not happy within that time. The issue is, you'd also need stands for these (£44.99 each, so an extra £180 for all 4 surround speakers!) or wall mounts (£25.99 per pair, so an extra £52 for wall mounts for all 4 surrounds) and the delivery cost is £50 extra, so it's blown your budget by at least £100.
A little on the smaller side brings in something like the
Canton Movie 125MX. These are also available for £300 from Richer Sounds, giving you £50 to look into stands or mounts of some kind for the speakers plus cabling. If you're buying all from the one dealer of course, you can look into a deal on these bits and pieces.
Finally, on the really small speaker front, you could look at the
Boston Acoustics Soundware XS package (available for £200 from Richer Sounds). This will be nice and easy to integrate into your front room, and gives you some spare cash for some Blu-rays! However, physics does play its part with speakers, and you won't get quite the same performance from these as you will from the bigger speakers which are able to shift more air.
Certainly the above is by no means the be all and end all - there's plenty of choice around this price range and I'd recommend actually visiting a few dealers (Richer Sounds looks like a good bet) and trying to get some demos so you can listen yourself. But hopefully this gives you a good starting ground to look into.