Moving From AVR to Amp


Relative newbie here so please excuse my lack of knowledge. I am assembling a system for HT and music (70/30 respectively). My room is 29x12, viewing/listening position is about 8-10 feet from the front speakers. I started a couple of years ago with Totem Forests, Model 1 center and Lynks rears, Velo SPL-1500R sub. in a 5.1 set up. I have been using an Onkyo TX-SR805 and a Squeezebox just to start while I gradually build my system. I recently added a media center PC built by a friend, that I use mainly for streaming movies and as a blu-ray player. I am thinking of (1) adding a separate multichannel amp (either 5 or 7 channel) and using the AVR as a pre/pro for a while, (2) getting a good stand alone DVD/CD player now, and then adding separate components in the next year or two. I am budgeting roughly $3,000-$4,000 (including interconnects) in this phase of the upgrade. Used but well cared for equipment is fine with me to maximize the value of my system. My questions, before I go listening/shopping: Is this a reasonable way to upgrade? Would I be better off selling the AVR and starting from scratch? What amps should I consider? Is it better to get a 5 channel amp for now and add a separate amp if I go to a 7.1 set up later? Sorry for the long post, but there seems to be alot of info to sort through and I am trying to learn.
theclam
personally, i'd (at least initially) keep the onkyo and your very good existing speaker config and get a three channel amp to power the fronts and center--perhaps something like a parasound or wyred4sound--i think you find signicancant improvement + save some $$. you can always change out pre/pro and/or add an additional amp later.
I also started with a Marantz AVR, moved to B&K Surround Processor plus a Gemstone 7-ch amp, and finally added a set of 2-ch gear. I have the same Velo SPL-1500R subwoofer. I concluded that I couldn't be happy with muti-channel gear for 2-ch music.

If I had to do it all over again, I would have just kept the AVR and added the 2-ch gear as the L/R channels since I cannot have dedicated rooms for HT and 2ch music. I am a music lover and I also like movies. I found most sound comes from the L/C/R channels for HT. If you off load the L/R channels to the 2-ch gear, the AVR is likely to be sufficient. Additionally, the Velo sub is 1,000W RMS (2,000W peak!), further reducing the demand to the AVR.

A key in this integrated HT/2CH is isolating the noises from the HT gear to the 2-ch gear. But that is another subject.
This is extremely helpful, thank you everyone. I think I'm leaning toward the 2 channel amp for the front L-R. Will HT suffer if the AVR powers the center and rears? Would a 3 channel amp solve this or would I again be sacrificing quality by moving to a multichannel amp? If I go the 2 ch route for now, do you have any suggestions for amps I should listen to? I see other posters recommending Simaudio and Plinius with the Forests but both seem rare on the used market and a bit pricey.

CK: your method sounds thorough and as far as buying used gear and re-selling, I do exactly that with photo gear but lenses are a lot easier to pack up and ship than 100 lb amps! I'm not sure I have that level of commitment (but that could change). I am in the NYC area and will look around for dealers who carry Totem to see what amps I can listen to. My strong preference is to buy used or demo gear.
Theclam, I hear you on the lenses (I am a Canon guy - love Fred Miranda site for swapping photo stuff). Amps aren't that bad to ship (like speakers for example). I think both SA and Plinius go well with Totem. But I would check some of the Totem threads for more ideas and what types of performance the different amps will produce.

Personally, I would keep the Onkyo and do as you suggest in the post above. I would even consider a BAT pre (with HT pass through) and a BAT SS amp. I think you may be able to get both together for well under your originally posted budget and suspect you will still be very happy with the results. FYI - I am down to just using a Yamaha AVR for my HT needs and to be honest am fine with it. I had in the past tens of thousands of dollars in HT amps, prepros and speakers. Yeah, its not that good by any means, but I am not that much into movies and I find my current system perfectly satisfying for me. Two channel is where my money goes now.