I envy your two channel system! Although my cheapy alternative of the 1070 and Wharfedale Diamond 8.3s is good enough for now I can only aspire to what you are running.
From a performance perspective I can say that I have no complaints with my new 1070. It has much better clarity and resolution than my old Sony(which one might expect since the Sony was only $300). Running the Wharfedales and, 5 Mirage Omnisats and a Mirage OM200 sub the sound from the 1070 in my 12 x 20 room is excellent. My new favourite demo is the first track of the Animatrix DVD. The opening fight sequence has lots of sharp surround effects and the rest is a major ride. Since this sequence is totally CGI the sound is very well produced and mixed. Although I don't attend too many movies in theatres lately I don't expect I'd be missing anything except perhaps a sense of the 'size' of the theatre itself. I guess even that could be simulated but why mess with a good thing.
I did a lot of research before getting the 1070 and it sure looks like the best option for the price. I was really set on an Arcam receiver but for an extra $600 - $700 I just couldn't justify it.
Just be warned - the traffic dealing with strange 1070 behaviours you'll find in this forum appear to be based on fact. I've had some quirks show up but then again my old Sony was 'brainless'. Sometimes that's a good thing but at this level of equipment you're unlikely to find a 'straight-wire' solution. Apparently the Outlaw guys are a great bunch as well. Hell, Gonk alone is enough to steer you 5 degrees towards the 1070!
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1070, Arcam CD73T, Pioneer DV46-AV, Project Xpression-Grado Red-NAD PP2, Monster HT1600, Wharfedale 8.3 Diamond, Mirage OM200 sub, Omnisat Micros x 5, homemade speaker cables, Dell Axim 51v remote