There's not really a way to "retrofit" Pro Logic II into the 1050. I had a couple fairly crazy notions that are based on the idea of keeping the 1050 and buying something else with that $300 or $350 (not really what you were looking for), but none that I felt especially good about. I'll offer them anyway for the sake of amusement.
One was to look for a used Model 950 and connect its pre-amp output to the 1050's 5.1 analog input to provide you with an amp, but the only used 950 I saw on
Audiogon was asking $450 (which would probably mean delaying until you could gather the extra $100 or so). A similar crazy notion was to use one of those cheap receivers with pre-amp outputs as a Pro Logic II decoder and then feeding the 5.1 on to the 1050 - the Pioneer VSX816 retails for $300 and has pre-amp outputs, although very few others in that price range do. You'd still have the 1050 all the way through for DVD watching and music listening (using a separate player hooked up to a digital input on the 1050), and you'd still have the 1050's amp section for video games. For the 950 route, you'd have to set the 1050 to a specific volume and then "blind" its IR sensor (some black tape would do the trick) so it stayed there when you adjusted the 950's volume. For the "receiver as PLII decoder" scheme, you'd need to find a permanent volume position for the newer receiver so the 1050 handled volume control for all sources. Neither approach is ideal (in fact, some might question my sanity in suggesting either of them) - of the two, the used 950 is the sonically preferable of the two.
Perhaps a better approach would be to replace the 1050 with a used receiver, although there are some drawbacks there as well. You'd probably be looking for a higher-end Denon or a Pioneer Elite from maybe three or four years ago. I have no idea what the going price for those are, and any warranty that might still be on them will probably not be transferrable.
There's also Outlaw's new
financing program , I guess - sell the 1050 to help pay for a 1070, and have a year to finish paying it off. I didn't suggest it at first, but considering how off the wall my earlier thoughts were I figured I'd toss that one out there as well...