Amplifier to complete a 7.1 channel system w/great stereo music performance?

Thank your for your comments, opinion & sound advice!  Clearly you have more experience in higher end audio than I.  Quite frankly I've never give much thought of using a stereo preamp or an integrated.  When I started my system the priority was home theater and the Rotel multi-channel amp & surround sound processor have served me well.  I am now looking to enhance stereo music performance on a limited budget. 

What I have right now is a Rotel 1095 five-channel 200W per channel amp coupled with a Rotel RSP-1069 surround sound processor.  The way I listen to 2-channel stereo music now is by simply bypassing through my surround processor, which eliminates any sound processing via the bypass mode on the RSP-1069.  My CD source component is a Cary Audio CD-308.

My question is, how/why will a pre-amp or integrated amp provide better performance than a nice 2-channel amp that I bypass through my surround sound processor?

Because you're still using the preamp section of the Rotel, which isn't on the level of a good dedicated stereo preamp and so will continue to be a bottleneck to achieving better sound.  One of the big surprises many new audiophiles have as they try different equipment is how big an impact the preamplifier has on the sound of a system.  Most of us come into this hobby underestimating its importance -- me included.  You've got some very good speakers that will appreciate and allow you to hear the difference as you add higher quality upstream components. 

When I added a better stereo preamp and got the Rotel out of the chain for 2-channel, everything sounded richer, fuller, and the soundstage expanded in all directions.  Individual instruments and vocals also took on an added heft, solidity, and presence that sounded much more real and lifelike rather than relatively thin-sounding facimilies.  On the top end there was more detail flushed out, yet the treble sounded less brittle and more refined overall.  I just mention this so you have an idea of the level of improvement you might expect to hear by adding a better preamp, and a better stereo amp will likely also add substantial benefits as well.  In this way a good integrated amp can kill two very big and important birds with one stone, while separates give you more flexibility and potentially better sound albeit likely at higher cost.  Either way, your 2-channel listening experience should become much more enjoyable and rewarding.  Do research and read reviews, listen to as much stuff as you can, and enjoy the journey. 

You could also do this, depending how much you live in the digital world. You could get Parasound A21 and pair it with a good, but simple preamp. You could get tge integrated Parasound which is a truly great piece of gear. You could get a Bluesound Vault 2 and rip all your cds and have a streaming component for 2 channel listening. I have a Bluseound Node 2, The A21 and the Parasound P3 preamp. All my digital music is on an external NAS. I can also play my cd player if I want to.