Lena: Thanks for the two detailed replies. I am still waiting with semi-bated breadth for an "official" reply from Outlaw on the 1050 problem with dropouts. However, as I mentioned in my original post in this tread, I haven't found any mentions on any forums about dropouts like the 1050 is experiencing and I am not alone from the posts on that forum.

As for heat build up, I think this is higly unlikely, I have my system on an slanted, open metal racking system, so that the front of each item is 5-6 inches back of the item above it with plenty of vertical clearance as well. Finally my 1050 is on the top shelf (to get the clearest path for the remote), while my parasound amp is on the bottom shelf. Ambient room temperature in the room is under 70 (24x7), this time of year as I live near the beach in So. Cal. and it seldom ever gets above 85. My biggest problem is rust from salty air.

FWIW, I had no problem with LOTR on my system.