Wow, thanks for the replies and suggestions.
Looks like I've got quite a few options to consider:
1. Go 2 channel with a new ~£500 amp and something like the bushmaster on the front end. Amp needs remote control to keep everyone happy, so Bantams would not be an option, sadly.
2. Try and find a "musical" AVR at a reasonable price.
3. Investigate the possibilities with my current amp i.e. check out the analogue inputs/bypassing the built-in dac.
4. Try adding an integrated (or power) amp to my current system, using my current AVR as a preamp.
5. Any other options?
In the meantime, I'm going to have a play with my current AVR - I've got a couple of Denon 1920 DVD players in the loft (don't ask) that supposedly have pretty good dacs built-in.
I could use a 1920 player, fed into the AVR analogue input and compare this with the same tracks played through the Apple tv2s optical output. Should give me a sense of what is possible without spending any cash at this stage.
What do you think?
Martin