Is this a crazy idea.

Problem: It will never be as dynamic and 3 dimmensional if you're NOT USING an outboard DD/DTS pre/pro! Processing DD/DTS movies in your dvd player, and passing the info out analog to a preamp (which is what you're doing), never works as well, overall! It's just to flat sounding, and not enough snap and punch to the sound. That's my findings.
Basically, I never encourage trying to re-invent the wheel here. But audiophiles just keep on cutting corners with HT systems, trying full range passive setups all around, bypassing processors, avoiding bass managment and subwoofers all together--and they always tend to think they're onto some "hot-ticket" approach!
Yeah, no.
Anyway, you could tinker, but I think you'll find what I'm saying. good luck

"Is Flamb suggesting that only active speakers are ideal for HT?............if so your crazy."

Yeah, no, I'm informed, and plenty experienced! (about 23 solid years around and/or in high end audio/video. But thanks. Infact, just run your statements and comments on active vs passive through any high end custom speaker designer, and see if he's crazy too! Let me know, I've spend time at at least 4 speaker designers plants or homes, and it's just all achedemic here.

Chadnliz, there's a HUGE difference between active and passive speakers, that goes beyond just having some amps in a cabinet (although it doesn't have to be that way to be "active"), vs your favorite, choice amp driving passives!!!! Yeah, HUGE DIFFERENCE! The difference in large is that the active speaker has the amplifier dirrectly coupled to the drivers (woofers/tweeters), for SUPERIOR CONTROL, DAMPING, AND RESPONSE FROM THE DRIVERS!...that's what!!!
A Passive system uses (unless it's using no crossover design, or minimal, like Druids, Old Sonus Faber, Triangle, similar) passive, "current limiting" resisters, coils, caps, whatever, which restict current flow, and thus the actual control the amp has on any given driver.

So, to answer the question, as to whether active speakers are superior to passive speakers--All things equal (same drivers, same cabinet, even same amps (minus a passive crossover network, substituting likely an "active electronic crossover", or minimalist cross-over design), an active speaker is superior, hands down, yes!!! Ofcourse, it likely needs to be designed that way to begin with, mostly.
I once heard a demo of a pair of passive NHT 1.5's vs pro active 1.5's, and the difference was not suttle! The actives stomped a mud hole in the passives, threw mud in it's face, and threw a soundstage that dewarfed the passives!!!
Yeah, I'm very much into higher efficiency actives, even modified horns, and other that offer superior transient response, dynamic transparency, and realism, you bet!
I've yeat to be blown away by ANY, even high end passive HT setup, even driven by the best amps money can buy!
The Avantgards play in this arena, but then they're 110+ db horn speakers, crossed over to active woofers!!

"So???? If ANY high end speaker designer would agree then why are such a minute fraction of makers doing an active?"

IT's REAL easy. And They usually come up with about the same answers as to why the manufacture won't approve, design, or market an active speaker (and associated components). And yet, they all understand the huge benefits of active, as that would be ideal. (*yes, ideal!).
Basically it gets down to economics, marketing effectiveness, and return for their dollar!!! They must then be dealing with electronics as well, which means more involvement, and it's easier to simply build a passive speaker network. In short, it's WAY MORE EXPENSIVE to build an Active speaker setup! IT's hard enough for any of these companies to maintain profit margin, and keep the doors open, and the average consumer isn't going to be aware enough to chose the expensive one. (case in point, the NHT
active speaker system, at $8000...this is a SUPERB Speaker system, all in all, and it doesn't sell!!!--I'd put that speaker side by side with any passive Thiel, B&W, or Wilson Monitor, of the same parameters, and it DESTROYS THOSE SPEAKERS, YES!!!....however, that's my oppinion.)
And, yes, it's ALL about marketing! If you doubt, just ask
*Bose!
But yes, that's ok, I think it's wonderful that several here think passive speakers are equal to or even better often then active counterparts! (I liken this to people who read Maxim Magazine, and find all the skinny-hipped, fake-boobed chicks smokin hot!--That leaves all the "Betty-Boop-like", curvy, velupuous, "real women" are left for me!!!--no problem) LOL!
This just makes my job of promoting active setups, all the more speciliazed, and higher end!
Yes, if you like superior dynamic transparancy, powerful transient response, "hit-you-in-the-chest" dynamics, and basically realistic sound with force and body, then actives are for you, yes!
Heck, just play any serious rock and roll, 2 channel through your beloved passived speakers, then through some active ones, all sizes equal, and tell me what you think! The differences are clear to me.

Don't get me wrong. Just because a speaker is an active design (especially tbe many pro audio "active speakers" I've heard at Sam Ash) doesn't mean it sounds good across the board! It has to be a good speaker, fundamentally. You can't take crappy drivers, a slip-shod cabinet, and poor design, then make it an active setup, and expect great sound over all. No! All things equal however, and active is clearly superior. All powered subs are basically "active". That's why the dynamics and power handling are superior there!