What in the world is going on.....

"This has been one of my complaints that as your system evolves (improves) some poor recordings sound worse "

eh?

surely, everything should sound better, no?

All depends on the recording. They can make good ones if they try. I have the LP of "will the circle be unbroken" and have listen to it since the 70s. Years ago I got the CDs and they were unlistenable. Then they came out with a remasterd version and it was very good. I had the same with a Glen Gould piano recording. It all depends on the care given. I was listening to "jazz at the pawn shop" the music is not great but they set it up in a jazz club and recorded live and it is better than almost any more "advanced" recordings. I remember a recording engneer who wanted to have a simple mike set up but the producer wanted several. He put them up but did not connect them. Afterward the producer said "see, the extra mikes made all the difference". I can remember setting up some speakers that the coustomer insisted HAD to be biamped. So I put 4 in front of the speaker and powered them up but only connected 2 of them. He really liked it but I made the mistake of showing him what I had done. I never saw him again. Don't fool mother nature!

No, no! the better the system the worse bad records sound. The sound is accurate so you hear it warts and all. When I was a dealer I was often ask for a system which makes everything sound good. It is easy to get a system that makes everything sound the same, BAD!

I have heard things on my car radio that sounded great but bad on my system. You just don't expect to hear that much on a lesser source and your ears fill in the rest.  A simple system just gives a different experience than a complex one. In Japan they use to gather a group of untrained listeners and had them listen to music with buttons indicating whether they liked the sound or not. In every case they preferred the less accurate sound, this is one reason records sound bad, they are designed to appeal to untrained listeners. I once had a record I really liked; when my system got better I could hear that it was not that good. 

I have always liked Burl Ives. He didn't have much of a voice but he could put lot of expression in singeing.