I can confirm what Joey and Marsman have suggested as being true and correct.
Just to give you a bit of background, I go round the country listening, testing and setting up speakers (soon to be building them too!) and work in various studios as well as teaching audio production to 16-19 year olds.
First things first -
Has your graphics card got an HDMI output on it? If so, I would actually recommend outputting sound via HDMI for several key reasons:
1. It is uncompressed/lossless
2. It carries all major surround formats
3. Its one cable!
I would personally ditch the soundcard you bought tbh dude (although I run a load of pro cards/interfaces in my studio so I'm a bit of a audio snob!).
I recently got my RME Fireface 800 modded by a company called Black Lion Audio (
www.blacklionaudio.com). I run this interface into a Rega Brio-R amplifier and out into a pair of KEF LS50s (also I have some Genelec 8040As connected to the FF800).
People are always stunned by the quality of sound in my studio but just for that setup we are talking £3,000+. Obviously a little out of budget.
However, there is no reason you can't get 80% of that with much cheaper components (and well within your budget).
I would definitely go the Home Cinema Receiver route in your situation. Spend as much money humanly possible on the receiver as this will be acting as your DAC (Digital -> Analogue Converter) if you connect to it from your graphics card via HDMI. I would even go as far as to say spend the entire budget on the amplifier and then save some money for a pair of bookshelf speakers and speaker stands.
Also, I am always recommending the following speakers on here but they are a steal for what they are in my opinion (and I hear new speakers all day every day in my line of work).
Monitor Audio BR-2. They are a steal for what they are. Yes, they use cheap components but they are finely tuned and good performers for the budget.
Be sure to buy some decent stands (almost as important as the speaker...seriously!) and some decent cables.
So in summary, I would sell the Xonar, buy a decent AV Amp, Monitor Audio BR-2s (or BX-2s) and output sound via your graphics card.
Alternatively, if you want to hear the best speakers for under a grand just go and buy some KEF LS50s! You will NOT be disappointed...