Does the Philips have some kind of digital input? I've not heard of it, let alone auditioned it, so can't give you an opinion.
Upscaling is definitely not possible in receivers in this budget range. If you get something with HDMI, you'd be very lucky but that'll be pass-thru for sure. I'm not a HT nut so not sure, maybe Chaos will chip in.
The receiver is bundled with the package. If you read the thread linked to earlier, you'll see that
1. I was interested in a system only for gaming. The 140.5 sufficed for it, and the Onkyo did not (the 3100, I hadn't heard the 3105).
2. I do recommend the 260.5 as the bare minimum for HT, not the 140.5, as the sound was a little too coloured.
There are plenty receivers under 20K, but most have very castrated features. The Pioneer is outdated by two years, but it cost about 10K so it's OK. I can always mod the innards to get what I want out of it at some point, or relegate it to kitchen or bedroom duty and get a better receiver later. For standalones, the 260.5 is definitely the better package.
In all of these discussions, a location really helps, as any specific recommendations need to be made city-wise. Unless you're shy or have reaosn to hide it, that is.