Sound Advance a division of Sonace offers a loudspeaker solution that is hidden inside walls.

Once installed the Sound Advance SA2 can be covered with latex paint or water-soluble wall coverings which make them literally disappear entirely into the room surfaces.
The Sound Advance SA2 flat-panel loudspeaker features a flat panel, expanded-polystyrene foam diaphragm driven by dual, specially developed voice-coil assemblies. The arrangement yields both extended low-frequency reproduction and very wide dispersion of mids and highs. Basically the Sound Advance flat-panel loudspeaker work by acting as a transmission line, radiating vibrations from its entire surface so they can radiate naturally balanced sound over a wider area, enveloping the surrounding area even when covered with plaster, paint or wallpaper.

The Sound Advance SA2 is 21 x 14 x3 inches (HxWxD), and weighs less than 8 lbs. Available accessories include installation “back-boxes” for wall depths of 4 and 6 inches, a metal-stud install kit, and 70V and 100V transformer adapters for commercial distributed-audio installations.
More details on the Sound Advance site.