Two-channel is inferior to multi-channel, no?

I have had some pretty expensive two channel systems in my past. And I definitely appreciate the refinement of what I can get from a 2 channel rig, readily. Truely, there certainly is a lot of gear out there, which can make the most of what is available from 2 channel source material, radio, cd's, vinyl, what have you. And it is likely easier to best setup 2 speakers in a room than it is many loudspeakers.
And, as for music, it's mostly definitely true that superior quantities of quality recordings can be found in the two channel format. So, on that merit alone, when considering music only, I think it's pretty difficult to argue against two channel for music. There's simply more quality content, and more gear that's designed to maximize that format. If you take 2 channel sources, and process them through a multi-channel system, you're already gunna lose something in the quality category. If you're into sound coming from all around you, and don't mind the overall refinement of the recording likely deteriorated a bit, I don't think you have much to stand on in this argument. At least, most will disagree with your position here.
When it comes to movies - and, more specifically, digital movie superiority as of late - I think it's going to fall into what's originally in the mix - multichannel. Down-conversion is your only option in this case and, as I stand with the 2 channel into multi-channel processing, I think you can't really argue against keeping things original in purity. Here, multi-channel is going to get the vote from the majority.
So, I think, if you're a music aficionado, then 2 channel setup is your weapon of choice. If movies, you're gunna favor multi-channel for what it's obviously designed for.
I really can't see anyone who's only into 2 channel sources, saying they think playing stereo into a Logic seven, or PLIIz, er what not, will walk all over a 2 channel rig for stereo sources. I just don't see it (er, hear it, rather). And, movie buffs, the same.
If at all, a hand full of die-hard 2 channel guys who like movies on their 2 channel rig as a preference, perhaps. Beyond that, the votes will all stack in favor of what I mentioned above I believe.
That's my take basically.

Yes, Audyssey - or any other DSP room correction/EQ device - is a good tool for helping systems/acoustics out. This is certain. As a final tune for your system, I think these are necessary, particularly in typical small home systems, shared entertainment spaces, and most any situation where you're not dealing with all out fully dedicated and engineered acoustic spaces, sure.
That however does NOT FIX fundamental flaws in initial setup parameters and considerations.
Here's what something like Audyssey WILL NOT DO:

1) account for/fix acoustic "holes in the response curve"!
(place a speaker/seat where there's a hole in the
response, and you'll ALWAYS have a hole in the sound)
2) properly adjust for phase between ALL listening
positions and speaker locations, in relation to each
other and the subwoofers!
3) properly "aim" or "toe-in" your loud speakers for
even coverage and tonality across all seating locations
4) fix for inherently placing loud speakers "too wide" in
relation to one another (causing undefined oundstage,
soft transients, and week overall imaging.
5) teach you to properly place loudspeakers so their not
placed too close together, creating too narrow of a
soundstage, constricting envelopment, and cramping
steering
5) properly place speakers for proper steering and
envelopement
6) Adjust phase between multiple subwoofers for accurate
phase from all listening positions in relation to each.
7) properly address first order refelctions in the room
from listeing positions in relation to speakers
8) accurately adjust and/or deal with "reverb" (rt60) in
the room (you got too much bass and overhang to
replicate a large acoustic space - room sounds "small")
9) accurately predict and adjust for a good crossover
between speakers and subs (Even Audyssey gets it wrong)
10)Help you chose correct gear allowing for maximum focus
impact, dialog inteligibility, resolution, overall
system matching, etc (years of audiophile experience
can't be erased and made up for with Audyssey, sorry.)
11)Can't replace refined equipment, and what it offers,
beyond what EQ'ing can do.
12)Nor can fancy EQ's help you adequatly select the proper
types, amounts, and locations of acoustic treatments
necessary to get the best sound from a room/system.

Basically, Audyssey and the likes helps greatly, yes. Still, it cannot fix foundational errors, and educate someone on how to put together a complicated multichannel system, and expect world beatter kind of results! It's just not gunna happen...unless you get real REAL lucky.
I mean we're talking 7 speaker, a subwoofer or two, multiple seating positions (likely), various acoustical issues to be properly addressed (thes rooms are SMALL), and a myriad of other issues that most novices aren't gunna have a clue about (if you don't know what's doing what, how can you fix it?)
Bottom line, can't replace experience with gadgets..and you can't get me to believe someone who's using Audyssey on their denon, to EQ out their Bose system, has the end-all-be-all system! Um, no

I am certain that you can get better sound quality with a carefully assembled 2 ch system. I know I have.
I still, however, get more pleasure doing a bit lesser quality with a carefully setup AV multi-ch system. This way, everyone gets to enjoy along with me.. When I get really ambitious, I meld the two, and loop the musically superior 2 ch system into an auxilary/loop/direct into the multi-ch system for surround and movies and what not. Best of both worlds, if must do both systems together.
All in all, I've heard best quality sound refinement from 2 ch sources and equip, yes. Still, more fun with movies and surround for me, I suppose. Guess it's a social/family thing

I would also like to qualify some of the responses above, where others are stating "multi-channel as superior". My experience is that most cannot even setup a 2 channel system for best sound, let alone 5 or more ch!
Let's just assume two equal quality level of recodings, sacd, whatever - one two channel, the other 5.1 ch recording. If you wind up getting several channels set up for lackluster performance from the speakers (due to poor placement and overall setup, acoustics, issues, etc), and you can forget about hi-fidelity coming at you from all around!
Imagine one speaker sitting in an acoustic hole at 63-80hz, or another too close to the walls (reinforce all the upper bass/mid frequencies and improperly treating reflection points ), or one speaker out in the open, and all of a sudden you wind up with way different fideltiy sound coming from each speaker. Now you got lack luster sound, and a hodge-podge setup, that's in dire need of some help!
I think, with 2 speakers, most people have a much better shot at getting a reasonably descent setup attempt -less possible acoustic issues to address, simpler, etc. In this case, you'll likely have the potential for better over all sound quality. I'm just sayin.
The more complicated, the more the average audio hobbiest is gunna screw things up. K.I.S.S. applies here over throwing in many more variables, beyond the control of the masses.
What does everyone think here on my viewpoint?

Again, much more high quality 2 ch content, music-wise, and most can't barely (if at all) maximize and properly setup 2 loudspeaker channels to allow for accurate high quality sound reproduction playback in the first place, let alone 5 or more channels! (If you don't think so, simply play dedicated high quality signal and/or also frequency sweep through all the channels in your system independently, and see what level of quality you get from each! I think most using multi channel setup will find significant flaws in frequency response and overall sound quality from their seating position(s), loudspeaker to loudspeaker??!
So I'd simply ask myself if it's better to get the all you can eat volume meal at your local buffet, or rather to eat at a 5 star restaurant!?!
I say, quality over quantity, every time, should probably get the vote, IMO

NO NO NO NO!!! LET'S KEEP THIS CHEESE GOING!!!
I dont think we've come to a decisive conclusion yet! Sooooooo.. Kinda like Republican vs Democrate view points. Theres still questions n debates to be settled!?!
Bunch o quitters!!! Come oonnnn! lets argue!! :-)