many, if not all of the oem radios/cd players from toyota are backwards compatible with the rav4 connectors and are a direct plug in. i just installed a 2003 head unit into a 1996 rav4 it is double din, but it fits in the area for the cigarette lighter which has a double din bracket already in the original components of the rav4. i have a 1996rav, so cannot be certain of the older rav4s. some of the better head units you may want to upgrade to are the scion head units, or 4-runner head units which i feel look the best. they also play mp3 cds. (WMA on certain ones) in our two 2003 rav4's i've swapped out the head unit with a 4runner, and a scion head unit. the scion head unit is good because it has more technology and has different sound boost settings incoorporated in it. if you are into color, then there is even one scion special edition stereo which has the setting to change display colors. if you are willing to spend more...around 250+, the scion 2008 special edition headunits, with on screen graphics is also backwards compatible...i am not sure if they are backwards compatible in size, but if you are installing it into a 4.1 rav, then i believe you will still have to cut the double din cigarette lighter cover in order to incoorporate the double din unit (this is oem
http://www.lucusjapan.com/images/cache/details/TCV_1533335/originals/1533335_6.jpg and it is what you are striving to modify it to) ...UNLESS you have the plastic piece which is made to accept the double din units. you can get the stereos on ebay for around $50 or less if you are lucky...i just looked on ebay and it seemed like even the camry and corolla, fj, and matrix, pretty much all toyotas are backwards compatible...but some headunits are shaped to the new style of the newer vehicle dash so they won't fit without major modification to either the stereo, or the vehicle. so best to stick with the standard double din rectangular looking decks...so up till 2008 is your best bet.
i also agree with the posts mentioning the low quality speakers. you can upgrade to some entry level speakers which will drastically improve the sound quality.