Speakers for small listening room

Sean and the others are right. Definitely play with placement before you even bother with other speakers. I'd try a long wall placement ASAP. A friend had a room about the size of yours. Two hours of moving things around made far more improvement than swapping in about $10,000 of electronics.

Thanks to all.... I have been reading all this great stuff, and I have taken away a few things.

1. Experiment more. I need to take some serious time to move stuff around beyond minimal changes. It may save me some serious money.
2. There are some great specific suggestions, some of which revolve around using the long wall.... not an option without some major construction. Also, thanks to Tobias for his suggestion. I wouldnt have thought that one up without some one else coming up with it first.
3. There are some resources out the to help with this. Thanks, I will work with them.
3. There are some speakers (eg Gradient revolutions) that seem to have some design characteristics that speak to exactly the kind of issues that I seem to be facing. I will check them out after I have exhausted the above options.

All in all, thanks. I feel a little less hopeless about getting the sound I need.

I would suggest that you look in to room treatment. I am enjoying a pair of three-way, sealed, floorstanding speakers in a 12x16 room. While the overall amount of bass was not an issue, acoustical treatment went a long way in cleaning up the lower range as well other regions.

What might be a more important issue is listening fatigue, mainly due to a bright tweeter. I have done no research, but I suspect the cause to bleed down in to the midrange as well. I think you should be aware of this possible, and most bothersome problem, especially given your current amplification and budget. There is a lot of bright gear running around. I have about a total of $3k in amplification and speakers and had a problem fatigue. I bet you will be wiser in your component selection than I (although I have little regret), however. Besides the gear, an untreated room can make a large contribution this problem, and in my case, room treatment has solved it. Treatment will also have a positive effect on imaging & clarity throughout the entire frequency range.
Maybe I am making sound like an elixir, but I think acoustic paneling and bass traps is worth considering. It has certainly made my listening much more enjoyable.

Someone who knows a lot more about this than I is John Risch. In the FAQ section at audioasylum, he has some information and some DIY panels and traps that are very effective and that can be made to look nice. Well, as nice as a panel can look. Good luck.

ATC makes a wonderful speaker for $1100. Great British sound.

If you end up looking at buying something different, I'd suggest looking at a pair of Dunlavy's, probably the SM-1 monitor. I'd call Audio-Video Logic in Des Moines if you don't have a local dealer - they're very helpful and will be able to help you determine if this will work in your room.

Anyway, the suggested setup is along the long wall, widely separated and seriously toed in. I don't have that option in my room, so I haven't gone this route, but if you do have that option, it might work perfectly for you. You sit within a foot of the rear wall, so you can avoid the "speakers on top of you" effect. -Kirk