You can look at this from different directions.
Signal Path- If you can wire directly to the TV you actually eliminate the need for an extra cable/s. This reduces the wiring/switching points. The promblem with this is that the person using the TV must know to switch to the correct input when switching devices (DVD to Cable) or you must have a universal remote that does this for you. Theoretically you will get better quality Video by wiring directly to the TV. I actually believe the theory, but can people actually notice it is another question.
Ease of Use- Wiring all Audio and Video to the processor allows that to do all the necessary switching, so it should be easier to use, without the need for a Universal Remote. You set the TV to a specific input and use the processor for all else.
Personally- I wire everything directly to the TV and use my Universal Remote for ease of use (for my wife). If I had a time where I had more devices than inputs I wouldn't hesitate to put the wiring through the processor (I would still use the Universal Remote). I doubt that I would be able to tell the difference. Currently My TV has (1) HDMI and (2) Component Video inputs. I definitely think that in the next two years it will be necessary to do swithcing with one or both of them.
Regards,
Charlie
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Charlie,
Outlaw 970, B&K AV5000, Paradigm Ref 20 and CC (V1), Martin Logan Dynamo, Sony 42" RPTV, Toshiba HD-A1