HDTV newbie seeks wisdom on setup-Thanks

Hi folks thanks for the interest and advice on my behalf. Let me brief you on the setup...
HDTV: Sony KD-34XBR2
Processor:Yamaha RXV 1200-would like advice on Lexicon,Krell etc as possible alternative processors
Front Speakers: (sweet little) Thiel 1.5 CS
Front Amplifier:Krell KAV 300i
Back Speakers: B&W CCM-80
Center Channel: ?
Interconnects: Generic coax cable
Source: Dish Network Dish 500
Room: Rectangular about 20X15,ceiling 8'
First question is about the annoying digitalized picture that I get from certain stations. Yes,I know we are not living in an HD world (yet),but I hoping that better interconnects -say TV and Dish receiver will improve the quality of the picture. It is currently rather digital on certain stations.Any recommendations will be greatly appreciated. What other interconnects might you forsee as important to the overall integrity and quality of sound and picture.
Issue numero two: I want to integrate my cool little Krell amp preamp with a processor.The thought is to integrate the Yamaha processor -for the back speakers-with the Krell.Is this feasible or would it be better to simply buy a home entertainment processor. Any suggestions.
Is center channel imperative-Sorry if this is a ridiculous question,but considering the vibrant nature of those little thiels -well I just don't know...
Any web site you might recommend to enable me learn or gain some insight on the project at hand.
Most importantly! My thanks for you time,expertise and feedback. I appreciate it. DJ Rodriguez,MD