The main principle to remember with ICE, is the addage that a chain is only as strong as it's weakest link.
For a few hundred £, my recommendation would be the following....
Alpine head unit - the best sounding CD players and RDS tuners for in car applications that sensible money can buy. Great user interfaces and decent styling. Oh, and they last for years.....
To do what you want, something like this as a head unit - http://www.caraudiodirect.co.uk/alpine- ... -6422.html
And this cable - http://www.caraudiodirect.co.uk/alpine- ... -5637.html
Will give you radio, CD and iPod. Alpine units use their own software to decode the iTunes so it sounds a bit better too. Still not CD quality, but OK.
Speakers could be run off this head unit. Not ideal but they could be. If you want sub bass (which I recommend) then I would go this route....
Amp - http://www.caraudiodirect.co.uk/audio-g4500-p-7290.html
Sub - http://www.caraudiodirect.co.uk/audio-8 ... -7283.html
The little JL sub will fit in a small box and will really enhance the low end, letting the speakers do the job of reproducing the other instruments and vocals. And for those speakers - http://www.caraudiodirect.co.uk/audio-e ... -7297.html
Great sounding speakers.
Then with some cabling (£50) and Dynamat (£50) you'd have a sound you'd love and you can get just how you want.
There's no rear speakers here, you can run a pair off the headunit at really low volume. The sound should be infront of you, not booming from behind so all you need is a little bit of rear fill.
Total for this:-
Headunit and iPod cable - £170
Amp - £270
Sub - £70
Speakers - £180
Cabling & soundproofing - £100
Sub box - (est. £75)
Total - £865
If you dropped the sub and amp for now, that's £525.
Does that kind of help??