This is a matter of much debate as of late. I'll toss out my two cents' worth.
The MMC-1 is derived from a very respectable platform (the Sunfire Theater Grand IV). Feature-wise it is actually a little behind the 970 - less sophisticated bass management, no bass management option for the 7.1 analog input, and non-universal remote. The sound quality should be comparable to the 990 (based on the sound quality of the DMC-1 which also uses the same basic platform). It's a nice package.
The LPA-1 has been widely complemented by owners. Professional reviews are scarce (Audioholics reviewed the LMC/LPA combo, don't know if there have been others). Outlaw's amps cost more at least in part because they are built in the US rather than China. I found myself looking at
this picture of the LPA-1 at Emotiva's site today and commented that the LPA-1 doesn't use a toroidal transformer (something that Outlaw
does use in all of their amps and in the Model 1070). Jghim pointed out that Emotiva's info page on the LPA-1 refers to a massive toroidal transformer, which is a bit confusing.
I have some reservations about Emotiva, largely due to the LMC-1. It doesn't directly relate to the issue of choosing between 970/7125 and MMC/LPA, but it does relate to Emotiva in general (and to the challenges inherent in developing the next generation of surround processor with the added complexity involved in HDMI v1.3). The LMC-1 is the one surround processor that Emotiva was involved in significant design work, and there have been some worrying problems with it. Even after beta testers identified a problem with the Pro Logic II/IIx implementation, Emotiva shipped the unit without supporting Pro Logic II/IIx with Dolby Digital sources - literally the
only instance of this that I have been able to find, and one that does
not agree with Dolby's description of Pro Logic II and IIx. This was fixed with a firmware update last summer (installed by shipping the unit back to Emotiva, although an update dongle is promised later this month that should allow the user to install it at home), but it forces a change in bass management behavior (triple crossover can't be used, changes to a global crossover). Surround mode memory is incompletely implemented, and there's been no word whether it will be changed - in fact, it was unclear
how surround mode memory worked until a user figured it out last weekend. Perhaps even more disconcerting than the intentionally incomplete Pro Logic II/IIx implementation is the response to a recently-identified DTS-ES bug (described briefly
here ). While they should have known better, they initially told customers that their implementation of DTS-ES was correct and that
every other receiver and processor manufacturer was in violation of the DTS specs. They have acknowledged the mistake and I believe that units now shipping have a revised firmware version that includes proper DTS-ES behavior, but it's disappointing that they made that claim in the first place. That particular debate led to some other debate at AV123's forum, where I started a thread a couple weeks ago trying to determine exactly what the present state of affairs is with the LMC-1. My original post in that thread included a list of questions, which has since been superceded by
this post in that thread.