What should be my next upgrade? Speakers?

If your budget can handle around $2200 for front main speakers, you might consider the Martin-Logan Source. They have been widely raved about for transparency and overall performance for the money, and I suspect would provide a huge difference relative to just about any dynamic speaker that costs significantly less. I should say, though, that I have not heard them myself, and that I have no feel for how well they might mesh with the other speakers of your multi-channel av system.

Regards,
-- Al

I should add to my previous comment that the Source's are 8db less sensitive than your Klipsch's, with similar power handling capability. So if you typically use most or all of the volume capability of the Klipsch's, the Source's would not be suitable. Essentially, I would expect the Source's to give you better transparency, accuracy, and detailing, while sacrificing peak volume. Their bandwidth specs are pretty similar.

Regards,
-- Al

Thanks for the info. I really appreciate it. They sure are beautiful speakers. I now plan on going to the Magnolia Best Buy near me and take a listen. Always hard to compare and listen to speakers in a store. : ) Regards,
David

I would replace your paradigm sub with a (used) James emb-1000 (or 1200) for much cleaner, more musical bass.

I would also sell the Monster HTS-3600 AC filter which is likely doing absolutely nothing for your system.....except maybe it looks good....and use that money to buy the subwoofer.

Thank you.
OK looks like your system is set up on the longer wall, which can likely help your cause somewhat, acoustically.
I pesonally like your Klipsch's in your system/setup, as they do so many things well for what you have going. They are focused, and VERY efficient and easy to drive with a reciever, and they match well with your NAD.
Klipsch's are traditionally a bit bright, but they match with the smooth NAD, your monster cabling (Don't listen to those "anti-cabling" nay sayers - lol), and you can tinker with toe-in and such for best sound. Basically, the Klipsch's are strong dynamically, and offer good detail for the money. I do like em for HT dubties in the right system.
Yes, you could change speakers for more refinement, but you might easily run into trade-offs and sacrifice CRUCIAL dyanamics, focus, and efficiency in a receiver based system, and simply be tading one improvment while sacrificing in another department. Basically, the Klipsch's, yes, are strong HT candidates for the money, IMO. So, I would say you're fine on the speakers for a movie system, if push comes to shove. I say this and I've some rather expensive speakers in the past, including the likes of Sonus Fabers, Infinity MTS's, Theil's, Merlin's, Dunlavy's, and other. I've also had the Klipsch's in my systems, yes. (although, as an audiophile purist, I like tube gear ideally with horn speakers)
I would say I'd recommend you might focus primarily on upgrading your projection system for more immediate impact/improvement to your system. Getting into Blue-ray and 1080p, with a good sized screen would be my goal, if it were me. I think you'd get the most boost in satisfaction from the system.

That all aside, as for those who are recommending against cable considerations, my 20 years around all this, and hours and hours of dealing with professional audio equipment engineers who think that cables don't matter, my experience is that their systems always sounded mediocre to poor, at best!
Yes, it all very much add's up, and should be considered - regardless of what short-sighted, biased engineers and novices might lead you to think...wires matter!