Why is 2 Channel better than multi-channel?

When I listen to 2 channel audio, what I listen for is
realism ... Does a flugel horn sound like a flugelhorn,
a piano like a piano, etc, to my ears in a performing
environment. I have not heard a multi-channel audio
system which does anything to improve upon the basic
musical timbre of instruments. So what can multichannel
audio bring to the table for music listening? If the answer is a larger and more stable sound stage for more listeners without so much tweeking, without muddying
instrumental timbres then multichannel audio is for me.
If the cost of multichannel audio is loss of instrumental
realism in exchange for better imaging, or in exchange for
better reproduction of the performing environment - then
multichannel is not for me.

When I listen, I would like to be able to hear the
performance. If you can't hear the tight bass on a
Steinway grand, you have missed the majic of artist mated
with instrument. An artist doesn't just play an instrument
he/she responds to it. I want to hear the synergy.

I agree with most of the above reasons why "2 channel is better than multi-channel". I have a more basic reason as to why I (will always) prefer 2 channel: I like music as it is performed. Maybe I don't understand 5.1, but how many of us ever get to sit in the middle of the orchestra during a performance? Most concerts I've been to happen in front of the listener. If reality is the goal, 5.1 has nothing to add to 2 channel (except maybe a random cough generator?)

Have you ever noticed that it's often easier to place instruments by ear at home than it is in a concert hall? There's so much reverberant energy in a "real space" that a two-channel rig in a home environment can't begin to capture. (Neither can a 5-channel rig, in my opinion.) In fact, the clear spatial cues in a stereo recording partially make up for the fact that you don't have the visual cues you do in a concert hall. And yes, Hindemith, I suspect you'd give up some of those spatial cues (which help you distinguish instruments) in a multichannel application. What you get in return is something closer to the concert hall experience. So there is a trade-off there, and you have to decide what you want.

Is anyone out there using the PANPOT? Is it worth to use an extra amplifier and a second set of speakers to send the (L-R) signal?

It's pretty logical and simple: Before the digital technology all recording engineeres needed is enough space and recording speed to place every detail of the live music onto the tape. Thus, 2ch recorders benefit with channel separation and amount of information stored per one channel on the magnetic tape to the multi-channel recorders. Also most of the professional recorders are using thick tape for the same reason. Mono recorders/reproducers are able to get maximum possible information(that's why I love mono recorded music)
Even in today's digital technology it does make a sence to still produce 2ch recordings guess why?... the same reason. Better channel separation and more information(bits) can be fit onto one track. Digital signal is nothing else but high analogue freequency with the phase shifts that we call digital samples.