Processor/AVR help and suggestions

Hey everyone, I was hoping to start a discussion and gets some thoughts on a new processor or AVR. I just sold off my Meridian G68 and HD621 and have about $4500 to spend. In terms of the use, I would say the most important to me is 2 channel sound quality, then surround sound. We spend about 70% of our surround sound time on DirecTV, 20% on Netflix streaming, and about 10% on watching blu-ray movies. I will pop in a concert blu-ray from time to time. I have a 5.1 set up at the moment, but will move to a 7.1 when we get into a new house next year.

The two options I was thinking of is either getting a mid-level processor that will decode the latest codecs via HDMI, and getting a really nice 2 channel preamp and using the pass through for music sessions and the processor for TV and movies. The other option would be getting a kick ass processor to do both. What are the forums thoughts on this? I would love recommendations for the mid level processor that has the pass through option. Balanced inputs are a must for my fronts.

In terms of the one box option, I am looking at the McIntosh MX121, Anthem D2V 3D, Krell Foundation, and the Marantz 8801. Thoughts on the 2 ch quality of those?

My current equipment:
B&W N802's, HTM1, and SCMS
2x McIntosh MC352's
McIntosh MC7205
Oppo 103D
I have used the precursor to the Marantz (?8800), the Meridian G61, and the Anthem 2DV. The video for the Marantz and Anthem were excellent, especially the Anthem. I was not pleased with the audio for any of the three, particularly 2 channel sound. I bit the dust and bought an used Meridian 861v8 (and HD 621) which is outstanding in 2ch and surround. A earlier version 861 is in budget for you.
In brief:

integrate your existing 2 channel into the 7.1 channel rig

In detail:

I had the top Cambridge AZUR AVR and it's matched Bluray player in a discrete 7.1 HT system (both the HT electronics and 7.1 speakers were separate and discrete from my 2 channel audio setup). It was clumsy having two discrete systems ( audio and HT), so I took the big step to upgrade and consolidate as follows:

Keep my REGA Osiris int. amp / REGA Isis valve cdp as my 2 channel but integrate them into my HT as follows:

(1) replace the existing AVR and BR player and 7.1 ML speakers (the full discrete system)
(2) bought a quality 7.1 preamp/processor for HT and surround sound recordings ...NuForce AVP 18 .., a terrific kit and as the CODECS change, it will be the disposable
(3) Bought the ARCAM Bluray player .... A step up (not subtle) to the Cambridge. It us used strictly for HT and surround sound recordings
(4) use the Rega Osiris 2 channel integrated amp via its direct pass through from the NuForce setting as the existing LF and RF speaker power amp.
(5) bought a separate used quality 3 channel power amp (Audio Refinement / YBA) for the Centre Channel and LB and RB surround speakers.
(6) bought a separate used matched 2 channel power amp (Audio Refinement / YBA) to power the side surround speakers.
(7) bought same manufacturer new CC and four new surround speakers (lower on the $$ food chain then my existing 2 channel L and R but still the same brand for synergy ).
(8) bought new hi-end quality ICs and power cables and speaker cables and HDMIs to hook it all up. (Kept all the existing Cables in the 2 channel rig of course)
(9) bought a Vandersteen subwoofer for HT exclusively ( not used in 2 channel mode)


-- my 2 channel audio system stands alone for critical 2 channel audio but the integrated amp also serves it's role in HT when I switch it over to direct pass through from the AV preamp/processor when HT requires.
-- The NuForce preamp/proc controls everything on its remote when engaged. It has all the latest CODECS and has only HDMI connectors And waves all the legacy ones.

Advantage :

(A) with separates the "disposable " to-be- upgraded eventually portion down the line is the AV preamp/proc without disturbing the rest
(B) The performance upgrade using the separates is graphic .... Stunning rather .
I agree with AKG, but took a different path. Stereo from an Ayre C-5xeMP, an Oppo BDP-105, and a Parasound JC-3 phono stage connect to a JC-2 preamp. The Oppo stereo uses a by-pass input to the JC-2, surround goes directly to the Proceed HPA amps, SW to a Velodyne SMS-1 bass manager. In addition to providing excellent AV, the Oppo does speaker management and provides DACs for a DirecTV HD-DVR.

I rely on the Ayre and Thorens for stereo, the Oppo for surround and HT. A Proceed Amp 2 drives the rear speakers, but I rarely turn it on, and I deactivated the center channel. I control everything with a Logitech Harmony One remote.

The Oppo is sufficiently inexpensive to be expendable in the event of a major technological development I feel I must have, but it plays Blu-rays with the latest codecs and provides a beautiful image to a 100" screen. For CDs and SACDs, it's no match for the Ayre, but it's no slouch either. Opera on Blu-ray is a treat.

Don't overlook the Theta Casablanca processors. They're easy to set up and IMHO the 2 Channel stereo is hard to match.
I'd definitely opt for a separate 2-channel pre and a decent AVP. Stereo sound quality is obviously the main benefit, but you're also then putting the majority of funds into what matters most rather than paying for expensive circuitry for surround channels, etc. And as someone else mentioned, when the inevitable necessary upgrade comes for the AVP you can do so with much less expense and keep the stereo sound intact. .

Another not insignificant benefit is your number of options. There are relatively so few AVPs that are truly good stereo performers, so what are the odds one will be optimal for your specific tastes and/or match well with your system? It's so limiting. Obviously with a stereo pre you have hundreds of choices unless you really need/want a HT bypass, but IMHO it's really not necessary and not worth compromising your choices.

If you do end up going the expensive AVP route I'd add the Classe to the list as I recall Kal seemed very impressed by it. Best of luck however you ultimately go.
I auditioned the MX120 a couple of years ago when I was setting up my rig, and I found it weak in 2 channel mode. Not entirely sure if that was also an artifact of the source, but it definitely didn't work for me. I'm a vinyl head, and the lack of integrated MC step-up input also was a nonstarter.

Because HT was very much a secondary consideration for my application, I ultimately went with a C50 for stereo and a MAC 3 pre/pro for 5.1. I was and remain very satisfied after 2 years of living with it and saved a bundle of money over the McIntosh one box solutions (currently MX121 and MX151).

So, I'd agree with most of the other respondents that separate stereo and HT preamps is the way to go. Personally, I'm a Mc fan, but Cary and Classe also auditioned well. I did not care for the Krell rigs, but that was just me. Auditioning what you can could make a big difference for you - it sure did for me.

Good luck & happy listening!
Thanks for the suggestions. I think I am going to get a McIntosh C2500 preamp, it has the HT pass through option.

Now, I need something that will just serve as an surround decoder and HDMI switcher with room correction for movies. I was thinking of a used Anthem MRX receiver and just using the preouts. Any other good suggestions? I would like to keep it under 1k.
You seem to be a Mac guy. Macs hold their value. Get the McIntosh