Splitting the signal should not degrade sound quality, as long as you use a reasonably well made splitter. You may need to adjust the left and right surround channel trim settings on the BD50, as the act of splitting the signal will reduce both divided signals. The adjustment is likely to be +3dB on both left and right surrounds, although I'd personally prefer to use a calibration disc's test tones and an SPL meter to verify that.

I think the word you are looking for is "marketing" - a receiver or processor that does not offer 7.1 support is going to have a hard time in the marketplace when all of its competitors do offer 7.1 support. And to be honest, the processing options available to generate 6.1 or 7.1 content from 2.0 and 5.1 sources are pretty extensive and widespread. Dolby and DTS both make sure to have equivalent algorithms (again, "marketing" is significant here, although it's not a bad thing - competition in the marketplace improves both companies' offerings). The only case where you see limited adoption is on source material, and I have a hard time complaining too much. Adoption of DTS 5.1 was slow enough that it's hard to be surprised DTS-ES Discrete didn't catch on, and I'm not terribly overwhelmed by Dolby EX (a Dolby 5.1 track and PLIIx is pretty effective, after all, and works with any ol' DD5.1 source). That just leaves the three new formats - Dolby Digital Plus, TrueHD, and DTS-HD - that can offer more than 5.1, and all were tied to a messy format war until earlier this year in addition to requiring changes in how audio mixing is done. That means studios had to decide to invest money and time in order to create 7.1 tracks that only work with formats that were caught up in a format war (coming just a few years on the heels of a format war in which both sides "lost" for all intents and purposes) and for a limited customer base. After all, many people are doing well to just get five speakers in their room - much less the seven needed to use that more expensive mix. That last issue - limited number of 7.1 systems - is likely to be a big reason that 7.1 mixes don't become standard. Here's an example: I work in an office of close to 15 people, most of them engineers. Out of that group, three have home theater systems with separate processors and amps as well as very nice speakers. Of the three of us, only one has a 7.1 system - the others are 5.1 and 3.0 (although the 3.0 setup may finally move to 5.1 before long). So of the 15 people who might buy movies, only one would benefit from a 7.1 mix - and even that one (me) would only benefit if he had a player with 7.1 analog outputs or a processor with HDMI v1.1+ input, which is not currently the case. So, basically, none of us could properly use a disc with a 7.1 mix at present. In contrast, those same 15 people include at least five HDTV owners, at least two of whom already own Blu-ray players.

in my 7.1 system my side speakers are the rocket dipoles and my rear speakers are the rocket bookshelf speakers. being that the speakers are different designs receiving the same info if i split it, is it going to sound off?

No more so than they do at any other time - after all, you are panning across that same set of surround speakers in other modes (Dolby EX, DTS-ES, Pro Logic IIx) in a very similar manner. Heck, in 7 Stereo mode, you are copying the left and right signals from the fronts all the way around, and this is just a scaled-back version of the same thing. The calibration you did on the 990 set the speakers' output levels so they match, and checking the BD50's outputs after splitting the signals will make sure the signals start out level when they enter the 990. As long as you don't have a level mis-match (such as the entire rear soundstage running too low or too high, or the rears higher than the sides) you should be fine.

i know what your saying gonk. Was i better off buying 4 dipoles or 4 bookshelves rather then 2 dipoles and 2 bookshelves?

the reason i bought the dipoles for the sides was when i ordered they suggested for 7.1, dipoles for the sides and direct firing bookshelves for the rear.

Yep, you bought right methinks. A lot of vendors suggest buying their speakers in that manner. Dipoles for the sides and regular speakers for the backs.

But you could have gone with 4 bookshelves and would have been good that way too.

I would stay away from dipoles all around for the 4 rears as you would lose a lot of the directionality that you get with the way your system is set up now, which is, I think, one of the points of a 7.1 system vs a 5.1 system. More front to rear and rear to front effects. Those kinds of effects, one would expect, would get muddied if you had dipoles in the rear.

The traditional recommendation is dipole sides and direct-radiating rears, at least for those spaces that are large enough to accommodate a 7.1 system effectively. I have the opposite arrangement, but it is due to room constraints rather than choice (my dipoles wouldn't fit anywhere on the side walls when we moved, so I moved them to rears and found direct-radiating speakers to use as side surrounds). I've had decent luck in my case, but I also have really good dipoles spaced out along a very wide rear wall (the room is 23' wide and 17' deep). In spite of what I've done, I would say that the most typical approaches are direct-radiating all the way around or dipole sides and direct-radiating rears, with the latter being the place to start in most cases.

any suggestions for blu ray players that decode DolbyHD and DTS Master with 7.1 analog out so i may use my 990?

The only one I know of is the Sony BDP-S550. It offers a feature set comparable to the BD50 but has a 7.1 analog output, but I'm not sure if it's shipping yet or not. It's reportedly due "this fall" from everything I've seen.

OK, there's one other - Denon's high-end Blu-ray player also has decoding and 7.1 analog output, but with an MSRP of $2000 and no Profile 2.0 support it's not a player I generally think much about.

Here's a chart of blu-ray players. This has been updated recently and should continue to be.

http://www.avsforum.com/avs-vb/showthread.php?t=1050507

Personally I don't care about 2.0, but I do care that it at least has 1.1.