Denon or Yamaha

This is really not an easy comparison. Each has their strengths.

I've enjoyed both and to be honest would say unless you're looking at the extreme high end of this market, go with whichever offers the feature set you need in your price range.

I think that's wonderful that the reponders here all like their brands of AV receiver. I'd recommend the Denon, which has historically had a sound that's a match for a wider variety of speaker systems, is forgiving and yet detailed, warm and solid sounding, and has the superior Audyssey EQ system - particularly on up the price ranges.
I also find Denon's stronger, dollar per dollaer, than the yamaha's. At least that's my years experience.
I do like the Yamaha's when mated with an outboard amplififer, often. But Still can't beat the Audyssey processing.
YOu'll have to try something and find out though. I'd start Denon, yes.

I just dumped my newish Yamaha AVR and replaced it with a separate Anthen process and Anthem 5 channel amp. Sounds way better. Who would have thunk?

Didn't say they were better.

Cannot comment on the Denon or Yamaha. That is why I recommended something I have experience with. I owned the Pioneer Elite VSX-29tx, VSX-39tx and the VSX-59txi, also several Sony ES receivers. I compared them at the time with offerings from Yamaha, Denon, Marantz and Integra Research. Based upon my comparisons and research I chose Pioneer "Elite" as my favorite time and again for home theater and surround sound receiver duties in a 5.1 and 2.1 set up.

They consistently excelled at Video processing and Music playback. They look great as well and have stellar audio system set-up software and microphone. http://www.pioneerelectronics.com/PUSA/Home/AV-Receivers/Elite+Receivers/VSX-53

Although I am not currently In the market I would not hesitate to look at the current SC or VSX series of receivers from Pioneer 'Elite". Read the reviews and judge for yourself.

Look into the Onyko TX NR809. Good value for power and features.

How are they better?

Neither, Look into Pioneer "Elite" or Sony ES receivers.