Here is a little example.
The club I work in had an audience area of 36X36'. Works out to just about 1000 square foot. I have seen 280 people in their and indeed is was VERY cramped!!!
We have a 12,000, 4 way sound system. There are 20 drivers!!! (8x18" subs, 4x15", 4X12", and 4x2" compression drivers with mid throw horns, which are really a bit too big for the room, thus I have a bit of a problem delivering smooth high end to the audience area, which will be fixed when we finally fly the speakers later this year).
Of course we do very loud bands, with a very noisy crowd, but this gives you an idea of what kind of power you need to get a get music over a crowd.
I don't think your budget is realistic by a long shot! EXPECT to need around 2000 watts of power as a minimum for a room that size.
As a start, I would maybe look into possibly the JBL TR series stuff, and maybe Yorkville amps. The speakers are going to be a bit bigger than you want, but with them, and at least 2k watts, you are going to have far less problems with people hearing even spoken word, and you won't be blowing drivers all over the place. Trust me, if you try to work with very limited wattage, you will either have very inadequate sound, or WILL blow a lot of drivers. Sorry, but in my best professional opinion, with having absolutely no interest in telling you otherwise for any financial benefit, I am telling you this out of years of watching people not spend the money for a competent PA for their purposes. Before this club started renting this sound system, they had a 4K watt system, and were blowing drivers every week. In the end, they spent as much money fixing stuff as they would have buying an adequate system to start with. There is little hope of them getting their money back out of what they purchased because of the laws of buying/selling stuff just don't work that way. Also, they had to deal with blow drivers, and the time spend taking them out, delivering them to the reconing shop, and putting them back in. At $80 a pop, and their labor, you can see how frustrating and uneconomical this was! Plus, even when working, the system just didn't sound that good because it was being pushed above the level it was designed to give good sound at. Plus it was gear that they "could afford" and that usually means Peavey or Carvin, and that mean far less "usable" watts then what it is rated at.
Do yourself a favor and invest in something that is a bit more than you "think" you need. In the end, you will be praising my name for taking that advice.....
Ed