Insane? Keep in mind your present company - other folks who either have, are in the process of acquiring, or would like to have good home theater equipment. Around here, you are a poster child for good mental hygiene. Ask some other people, and you may get a different answer...

It sounds like you've got a good plan in front of you, and a long but enjoyable upgrade path. As for Phase 5, my space is similar to yours (23' wide at the widest point, 17' deep, and 8' ceilings, with the sitting positions all pulled off of the walls), and I think it is very well suited to 7.1. The 420i's would probably more than suffice for that task.