Ok, here's the dilemma... BluRay (and upcoming technologies, no doubt) are designed for 1080p displays; and while $400 can get you a 32" 1080p TV, it's not going to be a trusted name (Sony, Sharp, etc.). For example, Best Buy carries the Insignia brand... and they have a couple models that meet your requirements. If it was my money, I wouldn't buy one of these (or similar) TVs. Dynex, Insignia, Westinghouse, etc, etc. Awful reliability, poor customer service and warranty support.
My advice? Spend a little more (less than $100 more) and opt for a solid brand. For example, the Sony KDL32BX420 is a great model that will do everything you require. Best Buy has it on sale for $479... Amazon.com has it for $470. You might be able to find a better deal that that. So, take a look at that Sony... also the Toshiba 32E200U is similar to the Sony, both in specs and price.
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