Are the speakers in the 299 bundle awesome, good or okay? The reliance digital guy told me that I should only go for it if I want to eventually change the speakers and he said that I should go for Htib around the same range.
If 299 speakers aren't good then what is the alternative?
In that price range, YHT 299 is the best. I think the store guy has misled you.
This kind of system with AVRs gives you an option of upgradability in the future.
All the sony, philiphs, LG, Samsung home theater system doesn't allow that.
Coming to your question, this is one of the most basic entry level system available @ 35K and for the price, it is awesome for movies if you haven't owned or heard any mid or high end systems
This unit is still good for movies and fair for music. The music playability is limited by the front stereo speakers.
If your room is small to medium (under 200sq. feet) then YHT-299 speaker are good. It is very good performer if room size is small and want to enjoy perfect separations in small size room (Large speakers would be overkilled). Above this room size you can update the speakers to Bookshelf/Floorstanders. But if room is small and you use big speakers then you have to control (limit) the sound of each channel because of its loudness, which doesn't make sense if you are not using speakers to its potential.
A two way or a three way book shelf or FS provides superior sound quality and musicality when compared to a Satellite speaker system. Loudness and power handling is secondary, SQ is primary. So if the system is replaced with a good stereo and centre speakers, then its going to definitely up the entire experience.