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I'm building an ultra-cheap PC for a family member and need some help and advice. The PC will be used mainly for web-browsing, light browser-based gaming and playing back HD video to TV via HDMI. I've taken a look at the Intel Celeron G550 and the AMD A4-3300 and they both seem to fit the bill, though I have experience with neither series.

My main question is will the Celeron G550 provide audio over HDMI? My father has a Sandy Bridge laptop and it doesn't, I'm presuming that the A4-3300 will as the 780G/785G chipsets did. Second of all which chip will provide the better user experience? From the data I've seen the G550 wins on the CPU front while the A4-3300 wins on the GPU front.

If you're not getting a discrete graphics card for them, grab the A4.

None of the tasks you describe need the CPU advantage an Intel chip provides, whilst most of them benefit from having the superior GPU and drivers.
I would be gobsmacked if the A4 didn't do audio over HDMI. APU's are pretty muched aimed at the HTPC space....
In saying that, I don't have one here to test if they actually do or not.

My wife has a Sandy Bridge laptop (Lenovo Y570) and it does audio over HDMI. It didn't when I had generic Intel HD Audio drivers installed, but once I installed the drivers from Lenovo's site HDMI audio started working.

Since we are talking about Llano here (and not BD) you are going to find it difficult to discern the two CPU wise unless you are doing something like Cinebench or video encoding. However, if the workload relies on the iGPU you will notice the difference. I'd go with the A4.